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Post by Deleted on Aug 7, 2013 16:02:10 GMT -8
Excellent point. The only way it will negatively impact margins is if there is significant cannibalization of the iPhone 5S. It's not impossible but Apple can play their cards right to avoid this as much as possible. That's a good point worth mentioning. I expect some cannibalization, but it will be far outweighed in raw revenue and profits from the big increased overall unit sales.
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Post by Red Shirted Ensign on Aug 7, 2013 16:14:53 GMT -8
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Mav
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Post by Mav on Aug 7, 2013 16:36:52 GMT -8
iPhone 5C, if it exists (my WAG is it does) could become the most popular iPhone depending on deployment. I doubt Apple cares, because the 5S should still be plenty "high-end" enough and Apple is very much going for share.
I wouldn't care either, because I'm a big fan of the iPod Mini Manuever. A classic stratagem.
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Mav
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Post by Mav on Aug 7, 2013 16:38:06 GMT -8
iPad - "mace face"! ;D red, I reject comscore's conclusion because Apple is Doomed. Oh right, Samsung's S4 is more or less brand new and iPhone "as old as dirt" but who cares about all that! ;D
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Post by nagrani on Aug 7, 2013 16:51:22 GMT -8
I was playing around with apples iWork software on iCloud.com - I think apple is going to release this for free and preload it on ipads. Could be a great way to increase corp exposure.
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Mav
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Post by Mav on Aug 7, 2013 17:10:20 GMT -8
You never know. At some point Apple may decide to make iLife and iWork standard on all Macs and iOS devices. OTOH, iWork for iCloud would work a bit better with an updated offline client. I mean iWork '09 is kinda...'09.
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Post by artman1033 on Aug 7, 2013 17:23:51 GMT -8
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Post by phoebear611 on Aug 7, 2013 17:33:13 GMT -8
CNBC is airing #TwitterRevolution - it will be repeated at the top of the hour. I love twitter so I'm a sucker for this ... but I wanted to bring it to Red's attention that William Shatner already made a cameo. Seems he loves to tweet. Are you a follower, Red?
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Mav
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Post by Mav on Aug 7, 2013 17:37:47 GMT -8
That's a good one. Brand. Image. Phone itself? ;D
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Post by rutgersguy92 on Aug 7, 2013 17:47:40 GMT -8
Hey Phoebes, Reports from Sunday's open practice at RU indicate very positive reviews for Chris, your neighbor. Said he had a strong and accurate arm. He'll probably red-shirt this year, however, since Chase Dodd is 2nd string QB (and a senior), and there is another older QB ahead of Chris as well. But I look for him to make some noise next year. Rutgers has a football team? Absolutely. In fact, Rutgers is the birthplace of college football, and the first national champ back in 1869. They beat Princeton in the first and only "college football" game that year.
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Mav
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Post by Mav on Aug 7, 2013 18:12:55 GMT -8
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Post by Deleted on Aug 7, 2013 18:21:31 GMT -8
"if it is indeed a real product". I thought that pretty much indicated speculation. Do you think the 5C will help Apple meet their "internal numbers"? I think Apple will total contractual orders from all of its carriers, what they sell direct (independent of carrier contracts), plus authorized resellers contracts, to determine their "internal numbers". The above will be adjusted up or down to maintain 6 weeks of channel inventory. The mix of models is already established in carrier agreements.
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Mav
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Post by Mav on Aug 7, 2013 18:41:51 GMT -8
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Post by Red Shirted Ensign on Aug 7, 2013 18:51:02 GMT -8
CNBC is airing #TwitterRevolution - it will be repeated at the top of the hour. I love twitter so I'm a sucker for this ... but I wanted to bring it to Red's attention that William Shatner already made a cameo. Seems he loves to tweet. Are you a follower, Red? Well, I am now....I want Picard to tweet. Now that is a captain! Patrick Stewart does have a twitter account but its not star trekky like Shatner, god, that man is ego personified.
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Post by chasmac on Aug 7, 2013 18:59:04 GMT -8
Excellent point. The only way it will negatively impact margins is if there is significant cannibalization of the iPhone 5S. It's not impossible but Apple can play their cards right to avoid this as much as possible. The old "we're sold out of 5Cs but have the higher priced 5S in stock" trick might do it. 5C is for color. Ignore Mace, he's getting old :-) TSLA, yeah! My SCTY on the other hand might have to hold for awhile. Decisions to make tomorrow.
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Post by Red Shirted Ensign on Aug 7, 2013 19:06:51 GMT -8
As Travis just tweeted, look what the divvy players have done to the August 440 and 445 calls.....gone!
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Post by Deleted on Aug 7, 2013 19:07:26 GMT -8
What needs would those be that aren't addressed by a 2 year old iPhone? Anything that has to do with data speeds is controlled by their local carriers, not Apple. Most Chinese customers are still being served by 2G networks, 3G is coming online, 4G/LTE is virtually non-existent. In that environment, as a Chinese customer, I'd find limited value of anything more than glorified feature phones marketed as cheap 'smart phones'. Even if Apple and China Mobile find a way to team up, the limitations of China Mobile's network is going to restrict sales. Apple isn't going to see dramatic increases in iPhone sales in China until Chinese networks are, at minimum, 3G with strongly growing 4G/LTE coverage. With a population 4X greater than the US, and a rapidly growing "middle class", there are more than enough wage earners that can afford Apple's latest/greatest without discounting it. Gregg I get your point but that doesn't explain why Samsung is selling so many cheap phones on the same network. The same network constraints would apply to their phones yet they sell boatloads of them. Three predictions..... 1. Tim's visit to china mobile was to finalize and sign contracts. ( I agree with a poster several days ago that they wouldn't send Cook just for more talks at this point) 2. When they announce the new phones, a new cheaper phone will be included and they will announce the deal with china mobile at the same time. 3. They will sell huge numbers of them because people love the apple brand in china and the only reason they haven't bought is the unsubsidized price is simply out of reach for such a large number on the china mobile network. Samsung is selling CHEAP handsets that are not expected to be used as smart phones, no matter how they are marketed. From Wikipedia. Doing the math 680,800,000 of China Mobile's subscribers use handsets that connect at 2G speeds, using a bastard protocol ill-suited for data consumption. 59,200,000 subscribers have 3G accessible handsets. None have 4G handsets (known to China Mobile anyway, because China Mobile doesn't offer 4G service). Assuming a two year upgrade cycle, if iPhone were to grab 10% of China Mobile's 3G subscriber base that would increase quarterly units by about 750 Thousand units (about 2% of estimated F2013 total iPhone unit sales). That would be huge, and well within China's population segment that CAN afford a $500 UNSUBSIDIZED iPhone 4S (or equivalent). Apple does not need a $250 - $350 handset to be wildly successful in China. EDIT[/b][/i] While responding to a Docomo/iPhone agreement sticking point I discovered that I had mistakenly described China Mobile's annual unit sales as quarterly. That mistake overstated the potential by 4X. I have corrected the error and apologize.
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Post by Deleted on Aug 7, 2013 19:09:57 GMT -8
I don't understand why many people believe an iPhone 5C would lower margins over that of the iPhone 4/4S. Without knowing the Bill of Materials I would think Apple has considered this and may have come up with a cost that at least maintains margins equal to or better than those of the 4/4S models. We shall soon find out. Edit spelling Totally agree.
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Post by chasmac on Aug 7, 2013 19:14:07 GMT -8
Foss Patents full articleHe is one interesting guy. Now if he can just work some magic for Oracle, things would get really interesting.
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Post by Deleted on Aug 7, 2013 19:16:56 GMT -8
Anyone worrying about apples company wide margin slipping due to a cheaper iPhone 5C needn't worry. Each incremental iPhone 5C sale will have a margin greater than the company wide margin, so each sale will be positive to GM%. Even wall street has already figured this out: tech.fortune.cnn.com/2013/06/03/apple-cheap-iphone-margins/I highly recommend reading the above link. It's from early June, and it's worth noting that Katy Huberty absolutely nailed the effect of the discounted iPhone 4 last quarter increasing shipment to 31 million units and raising company margins to 36.9% - it was a remarkably insightful observation that proved precisely correct. Damn, in all my arguments against a cheap iPhone, I had forgotten about Katy's analysis.
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Mav
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Post by Mav on Aug 7, 2013 19:22:48 GMT -8
Horace Dediu and MG Siegler continue their disagreement about Amazon on Twitter. And it's increasingly clear that maybe one of them gets the whole valuation deal, since no one's arguing that Amazon is a successful e-retailer that tons of people like to shop.
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Post by Deleted on Aug 7, 2013 19:32:34 GMT -8
DoCoMo is trimming the number of manufacturers down to 2 or 3. Limiting iPhone to 30% of sales would limit them to about 8,000,000 units per year.
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Post by Red Shirted Ensign on Aug 7, 2013 19:40:06 GMT -8
Anyone worrying about apples company wide margin slipping due to a cheaper iPhone 5C needn't worry. Each incremental iPhone 5C sale will have a margin greater than the company wide margin, so each sale will be positive to GM%. Even wall street has already figured this out: tech.fortune.cnn.com/2013/06/03/apple-cheap-iphone-margins/I highly recommend reading the above link. It's from early June, and it's worth noting that Katy Huberty absolutely nailed the effect of the discounted iPhone 4 last quarter increasing shipment to 31 million units and raising company margins to 36.9% - it was a remarkably insightful observation that proved precisely correct. Damn, in all my arguments against a cheap iPhone, I had forgotten about Katy's analysis. Katy has been very good the past three quarters... The cheaper iPhone was never going to undercut Apple's overall GM...maybe the opposite. If Apple builds what most of us expect they will, and sell what we hope they will, its a win/win.
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Post by chasmac on Aug 7, 2013 19:40:25 GMT -8
Horace Dediu and MG Siegler continue their disagreement about Amazon on Twitter. And it's increasingly clear that maybe one of them gets the whole valuation deal, since no one's arguing that Amazon is a successful e-retailer that tons of people like to shop. And when Amazon magically flips the switch and exerts their monopoly powers on teh stoopid consumers, what makes anyone think that the Feds won't give a crap? Nice piece by Horace. Btw, 3 posts in one day. See ya next month!
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Post by Deleted on Aug 7, 2013 19:48:27 GMT -8
Assuming a two year upgrade cycle, if iPhone were to grab 10% of China Mobile's 3G subscriber base that would increase quarterly units by about 750 Thousand units (about 2% of estimated F2013 total iPhone unit sales). That would be very large, and well within China's population segment that CAN afford a $500 UNSUBSIDIZED iPhone 4S (or equivalent). Japan is a wealthier market than China, but not so much for the top 8%. If one of Docomo's sticking points is to LIMIT iPhone sales to 30% of DoCoMo's total sales, might that be the benchmark to expect from China Mobile? If it is, then sales potential, without lowering iPhone pricing could be as high as 2.25 Million units per quarter. That's a 6% incremental increase over estimated F2013 unit sales.
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Post by Deleted on Aug 7, 2013 20:29:22 GMT -8
Anyone worrying about apples company wide margin slipping due to a cheaper iPhone 5C needn't worry. Each incremental iPhone 5C sale will have a margin greater than the company wide margin, so each sale will be positive to GM%. Even wall street has already figured this out: tech.fortune.cnn.com/2013/06/03/apple-cheap-iphone-margins/I highly recommend reading the above link. It's from early June, and it's worth noting that Katy Huberty absolutely nailed the effect of the discounted iPhone 4 last quarter increasing shipment to 31 million units and raising company margins to 36.9% - it was a remarkably insightful observation that proved precisely correct. I posted this yesterday on the Braeburn site, in response to a Robert Leitao comment.
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