April 5, 2012

Apple expected to become the world’s first trillion-dollar company by 2014

By Neil Hughes

Published: 07:33 AM EST (04:33 AM PST)
Shares of Apple have been projected to reach $ 1,000 in calendar year 2014, which would give the company a market capitalization of about a trillion dollars, making it the first company to ever reach that milestone.

Analyst Gene Munster with Piper Jaffray raised his 12-month price target for AAPL stock to $ 910 on Tuesday, up from his previous prediction of $ 718. He sees shares of the company reaching the $ 1,000 mark just beyond his one-year price target window.

As it has for years, the iPhone will continue to drive Apple’s growth going forward, Munster believes. He sees at least 70 percent of all two-year-old iPhone owners upgrading in a given quarter.

“That suggests 33% of iPhones in a given quarter through 2015 are ‘in the bag,’” he said. “We believe this is conservative given it expects an average iPhone life of 24 months.”

Piper Jaffray’s surveys found that 30 percent of iPhone 4S buyers at launch were upgrading from an iPhone 4, which suggests the upgrade window for those users is closer to 21 months.

“If we assume an average iPhone life of 21 months, and 85% of users upgrade to a new iPhone, that implies 45% of iPhones through 2105 are ‘in the bag,’” he wrote.

For the March quarter, Munster sees Apple selling 33 million iPhones, which is a 10 percent increase from his previous prediction of 30 million. He expects the iPhone will have an average selling price of $ 630.

“We believe demand remains strong for the iPhone 4S based on global store checks and momentum from the 3rd-gen iPad launch,” he said. His estimates are slightly ahead of Wall Street’s expectations of 30 million iPhones for the March qAuarter.

Munster’s discussion of a $ 1,000-per-share value of Apple came just a day after analyst Brian White with Topkea Capital Markets said he expects shares of AAPL to reach $ 1,001. He sees the price being driven largely by the $ 100 billion opportunity in the television market, which Apple is widely expected to enter in the next year.

Also this week, Mark Moskowitz with J.P. Morgan increased his December 2012 price target to $ 715, up from his previous prediction of $ 625. He sees Apple selling 31.1 million iPhones and 13.8 million iPads in the March quarter.

Apple is scheduled to reveal its earnings for the March 2012 quarter on April 24 after markets close. A conference call with analysts will occur at 2 p.m. Pacific, 5 p.m. Eastern.

AppleInsider

RIM announces Q4 revenues miss, top executives leaving company

By Daniel Eran Dilger

Published: 05:30 PM EST (02:30 PM PST)
BlackBerry maker Research In Motion halted stock trades before announcing a billion dollar sequential drop in quarterly revenues substantially below its guidance on shipments of 11.1 million smartphones and a half million PlayBook tablets.

RIM had offered guidance of $ 4.6 to $ 4.98 billion in revenue for its fourth fiscal quarter (ending March 3), but only announced revenues of $ 4.2 billion, down 19 percent from $ 5.2 billion in the previous quarter.

The company announced a GAAP net loss of $ 125 million, with 11.1 million smartphones hitting the low end of its previous guidance (of 11-12 million BlackBerry smartphones) and down 21 percent from the previous quarter’s shipments.

For all of fiscal 2012, RIM announced revenues of $ 18.4 billion, down 7 percent from 2011′s $ 19.9 billion.

The company also announced pre-tax charges of $ 54 million related to a service interruption the company experienced in the third quarter last fall (which required service credits to affected users), and a $ 485 million “inventory provision” made for the poor selling PlayBook tablet.

Top executives exit

RIM also announced that former “co-chief executive” Jim Balsillie has resigned as a director of the company’s board.

The company’s chief technology officer David Yach and global chief operations officer Jim Rowan are also both leaving the company as well, leaving the company in need of a new COO.

No more guidance

Thorsten Heins, RIM’s new president and chief executive, announced that the company would no longer provide “specific qualitative guidance” because it expects “continued pressure on revenue and earnings throughout fiscal 2013,” and out of “a desire to focus on long term value creation and the current business environment.”

“Some of the factors contributing to this,” the company noted in a press release, “include ongoing weakness in the Company’s U.S. smartphone business, an increased focus on selling BlackBerry 7 smartphones to grow the subscriber base in advance of the BlackBerry 10 launch, increasing competitive pressure in the Company’s international markets and the introduction of certain new lower tier service pricing initiatives and a higher mix of sales coming from entry level products.”

Heins noted that “the next few quarters will continue to be challenging for our business.”

iPhone vs Blackberry

Back in the third calendar quarter of 2008, Apple’s then chief executive Steve Jobs first announced that “Apple beat RIM” in quarterly sales, noting that “RIM is a good company that makes good products. And so it is surprising that after only fifteen months on the market that we could outsell them in any quarter.”

After iPhone 3G sales peaked during its launch quarter, RIM’s BlackBerry shipments again surpassed Apple, but iPhones continued to grow to the point where, in the third quarter of 2010, Jobs could announce, “We sold 14.1 million iPhones in the quarter, a 91% unit growth over year ago and way ahead of IDC’s estimate of 64% growth for global smartphone market.

“It handily beat RIM’s 12.1 million Blackberries sold in their last quarter. We’ve now passed RIM. I don’t see them catching up with us in the foreseeable future. It will be a challenge for them to create a mobile software platform and convince developers to support a third platform.”

While Apple and RIM report sales on staggered quarterly definitions, Apple most recently sold a peak quarterly total of 37 million iPhones worldwide, compared to RIM’s 11.1 million BlackBerry shipments this quarter, and over 15.4 million iPads.

AppleInsider

HP shareholders ask why company isn’t more like Apple

Meg Whitman, CEO of HP, had to defend herself against Apple during HP’s annual shareholder meeting on Wednesday, says a report from AppleInsider. More than one investor mentioned Apple’s innovation and asked HP whether it is equally innovative. Another individual asked Whitman why HP didn’t have retail stores like Apple which lets customers get a computer on the spot and not wait three weeks for a shipment.

Whitman said HP was founded on the “power of innovation” and created “disruptive technology” back in the day, but admitted the company recently has favored incremental evolution. She says HP has “to place some bets on disruptive or revolutionary innovation.”

Whitman is in a tough spot as the head of a struggling company. She took over after the company kicked out CEO Mark Hurd and then removed Léo Apotheker from the CEO position, following his suggestion that HP might spin off its PC business.



TUAW – The Unofficial Apple Weblog

HP shareholders question why company isn’t more like Apple

By Josh Ong

Published: 03:36 AM EST (12:36 AM PST)
During the Q&A session of Hewlett Packard’s annual shareholder meeting, individuals grilled CEO Meg Whitman on why the company isn’t as innovative and successful as Silicon Valley neighbor and rival Apple.

Apple figured strongly into three of the questions raised by stockholders at the company’s meeting on Wednesday.

For instance, one individual recounted how he had asked Apple co-founder Steve Jobs years ago how his company planned to compete with bigger PC makers like HP. Jobs reportedly told him that Apple products are “just better” and their technology is “years ahead of the competition, especially in mobile.”

“[Jobs has] been correct,” the shareholder noted, pointing out that Apple is now worth more than 10 times HP’s market cap. He went on to say that Apple had succeeded in a space where HP “used to be dominant.”

“Do you think HP was and is innovative enough?” he asked Whitman.

Whitman responded first by acknowledging Apple’s extraordinary accomplishments in recent years.

“We all have to applaud Apple for their success,” she replied. “This is one of the great business renaissance stories of our generation. I have to say Steve Jobs is one of the business leaders of our generation.”

She also reminded the gentleman that HP remains “No. 1 or No. 2 in every business” it competes in, while expressing her continued commitment to R&D and and products.

Another investor complained that HP doesn’t have convenient retail stores with repair service like Apple does. He pointed out that he has to wait two to three weeks for a new printhead to be shipped from HP’s facility on the East Coast when his printer is broken.

“There are obvious ways that you can improve the way HP appears to the customer,” he added.

Whitman replied by highlighting the company’s retail initiative in Brazil. She couldn’t promise that the economics would work out in the United States, but she did say that she was working on improving HP’s website.

Yet another investor pointed to Apple’s vision and success in the market. He wanted to know whether HP had a similar vision and had anything innovative “cooking in HP’s labs.”

Whitman reassured that HP was founded on the “power of innovation” and “disruptive technology.” She did admit that the company, in recent years, has underfunded revolutionary innovation in favor of more evolutionary and incremental innovation.

“We’ve got to place some bets on disruptive or revolutionary innovation,” she said.

The executive qualified that she’s hesitant to purchase revolutionary innovation through acquisitions and cautioned that the company will be making such purchases less frequently.

Whitman said she is a “big believer in focus” and encourages her leaders to just do “a few small things well.”

HP has had a rocky year. After less than a year on the job, HP ousted CEO Léo Apotheker last September and appointed Whitman in his stead. Just one month prior, Apotheker had shocked the industry by announcing that HP was abandoning development of webOS devices and hinting that it might spin-off its PC business. The news sent HP’s stock into a freefall.

Whitman was left to deal with cleaning up after Apotheker’s dramatic announcements. She announced last October that HP would in fact keep its PC business. Last December, she announced that HP would keep webOS and contribute it to the open source community.

AppleInsider

Buying LTE iPads For Your Company? Reviewing Your Mobile Costs First Can Save Lots Of Money

Buying LTE iPads For Your Company? Reviewing Your Mobile Costs First Can Save Lots Of Money

Considering LTE iPads is a good time to get a handle on mobile expenses

The new iPad’s LTE option offers a lot of potential for mobile professionals, particularly the Verizon version because it will support the iOS personal hotspot feature. The plans available from both AT&T and Verizon are pretty much in line with the previous iPad 3G plans for individual customers.

While plans for individuals are fairly straightforward, the options for business can be much murkier. Both carriers offer business plans and bundles, but no two businesses have the same needs or mix of devices. If your business is considering new iPads with LTE, you’ll want to sit down with your account rep to get the details about what options you have and possibly negotiate with them to get the best deal – but doing a thorough review of your existing mobile plans first can put you in the driver’s seat during those negotiations and save your company a ton of money.

It’s always a good idea to go into meetings like that with as much information about your current use as well as your anticipated usage for new devices or services. That gives you more negotiating power and it can help you trim some expenses while adding new services to avoid, or at least reduce, sticker shock.

If you’re already gathering that information, it may be a good time to do a thorough review of your telecom expenses as a whole – or at least your mobile expenses.

Taking a good detailed look at what you’re paying for and what your employees are actually using will almost always result in finding ways that you can save money. It might in the number of minutes that some employees use is out of proportion to the number that you’re paying for. It could be that certain executives aren’t coming close to using the amount of data for the data plan associated with their devices (or worse, they’re exceeding it significantly and you’re being charged overages).

This is certainly a job that needs the cooperation of both IT and finance. It can also be a tedious effort, but one that often will pay off in both savings and in building a relationship between IT and finance. It demonstrates that although CIOs or IT directors often need to make large expenditures, there is an understanding of costs and an effort to minimize them.

It can also be worth hiring a telecom expense management firm to help you sort through your actual usage and make suggestions. Often these firms are more familiar with the options available from carriers and can negotiate contracts with your carrier(s) for you to ensure that you aren’t paying for more than you need or getting charged with avoidable overages.

Some mobile management vendors (Tangoe and Amtel, for example) offer expense management services. Even if your mobile management vendor doesn’t, you can often tease usage data about smartphones and tablets out of the monitoring and reporting capabilities that MDM products include.

If you’re looking at the expense of several LTE iPads, doing this legwork can easily pay off big time. The resulting information can also be a rationale for making changes to your mobile policies and programs. You might even find out that LTE iPads aren’t as cost effective as Wi-Fi models with a handful of 4G/LTE personal hotspot devices.

DON’T MISS
How The iPhone Saves Money For Businesses (And Why Android Can’t)

Cult of Mac

Apple’s The Only Tech Company Allowing Independent Audits Of Factory Conditions

Apple’s The Only Tech Company Allowing Independent Audits Of Factory Conditions

No technology company in the world has been more scrutinized than Apple when it comes to labor conditions. Over the past couple months everyone has been quick to point out how crappy the conditions are at Apple’s supplier factories – Foxconn. But what a lot of the tech press hasn’t done, is investigate the conditions at the other major tech companies in the world. Not only is Apple the only company talking about what they’re doing to fix the problem, but they are the only major tech company that is allowing independent audits of their factory conditions.

It’s a simple question, phrased politely, and sent to the right people. Does your company have any plans to let independent auditors check up on your suppliers’ factories?

Here’s what some of the world’s biggest electronics companies said in response:

Hewlett-Packard

Thanks for your note.  I’ve included a link to all of our supply chain related material, including audit results, supplier list (we were the first company to publish this list in 2008, and additional material you may find useful).

Unfortunately I can’t provide a spokesperson for you at this time.

Microsoft

Microsoft is committed to ensuring the fair treatment and safety of workers at manufacturers contracted to our company.  We have invested heavily in a robust supply chain social and environmental accountability (SEA) program to ensure that supplier factory conditions are compliant with our Vendor Code of Conduct.  This means Microsoft’s hardware suppliers are required, under terms of our contract, to provide Microsoft and third-party auditors on-site access to each facility for auditing and assessment purposes.

Our program includes direct engagement with our contracted suppliers through an in-region SEA team to build their capabilities and awareness in relation to our code requirements, and to monitor their compliance and progress.  We train our suppliers on the Microsoft social and environmental requirements in supplier-training forums (since 2003), in one-on-one business performance review discussions, and in reviews and verification inspections of improvement plans for issues identified in audits and assessments.  If our strict standards are not met, suppliers risk termination of their contract. Our list of suppliers and the results of supplier audits are currently considered confidential business information.

Microsoft currently works with the Fair Labor Association [ed note: this is the organization Apple is working with] on a project basis, including conducting worker surveys and factory specific capability building projects. As we presently have a robust auditing program in place, a deeper engagement with the organization has not been considered by Microsoft.

HTC

Over the last couple of years, we have looked closely at how we can continue to evolve our global standards and practices to optimize for the health, safety and opportunity of the people that contribute to the success of HTC. As a member of the EITC, we conduct thirty to forty supplier audits each year to identify where practices need to be brought into compliance with standards. Our base in Taiwan gives us the proximity to react quickly to issues when they do arise.

This is a long term journey grounded in our commitment to act as a global leader, and we approach these issues with the goal of continually pushing ourselves, our suppliers and the industry towards ongoing improvement.

Toshiba

We regret having taken so long to respond to your inquiry.

Unfortunately, we are unable to respond to your request.

Now that we’ve seen how other tech giants are responding, do you think the amount of criticism Apple has garnered over the last few months is fair? Let us hear your opinion in the comments.

[Via BuzzFeed]

DON’T MISS
Apple Releases Names of 156 Suppliers & Report On Factory Conditions

Cult of Mac

Frima Studio’s independent thinking in a 350-person company

Given just how big the world of iOS development is, it’s hard to find a truly unique gaming company. Each has its own approach, but I find most companies fall into two categories: The young, small firms eager for a hit and the huge companies working with iOS’s smaller scale.

Frima Studio is a unique mixture of the two. With 350 employees its no small firm. Firma has done work-for-hire on traditional video games for years, releasing collaborative titles across brands and properties. But there’s a small team of three developers within Firma Studio who are working on original games. The company describes this group as “an indie game company working inside a big corporation.”

You’d be be forgiven for thinking that the studio’s first iOS title, A Space Shooter For Free, was the work of one developer. However, Frima’s original games team begs, borrows, and all but steals company resources to complete its titles. “If we want to make our games, we need to say to the biz dev guys that we already have the money,” Frima’s IP manager Martin Brouard told me.

Originally released with Sony as a PSP mini game, A Space Shooter for Free (formerly A Space Shooter For Two Bucks) has over a million players on all of its platforms. That’s earned Frima the opportunity to work on more original games, like the one Martin Brouard showed me called Nun Attack.

Nun Attack is exactly what you’re thinking: Cartoon-style, heavily-armed nuns fight off the bad guys. Due later this year, Nun Attack looks great. It’s essentially a clone of the very popular BattleHeart. Given that game’s age, I’m happy to have a new tactical RPG to look forward to.

The build of Nun Attack that I saw is simpler than BattleHeart, and includes an interesting overworld map to explore, several mechanics to play with (think dodging bullets) and gesture-driven abilities, which Brouard calls “miracles.” The game will feature four upgradeable characters with strengths like ranged attacks, healing powers and other usual, fantasy-style abilities.

Frima isn’t sure how the title will be monetized yet. A Space Shooter for Free is funded by in-app purchases of a virtual currency, and while that seems like a distinct possibility for Nun Attack, Frima wouldn’t commit to it just yet.

Even at this early stage, the app looked quite good. Frima’s in an interesting place in terms of being able to do some indie thinking with some larger resources, and that should put it in a nice position to develop for iOS going forward.



TUAW – The Unofficial Apple Weblog

Apple Is World’s Most Admired Company For Fifth Year In A Row

Apple Is World’s Most Admired Company For Fifth Year In A Row

image via Tropico Station

Another year, another title. Fortune announced their list of the world’s most admired companies this morning, and Apple swept away the competition for the fifth year in a row. Each year Fortune surveys the business community to find out which company has the best reputation in the eyes of their peers. Apple has ranked at the top of Fortune’s annual list for the last five years which ties them with General Electric for the number of most appearances in the top spot.


3,855 executives, directors, and securities analaysts were asked to select the 10 companies they admire the most. Rounding out the top 10 were Google, Amazon, Coca-Cola, IBM, FedEx, Berkshire Hathaway, Starbucks, Procter & Gable, and Southwest Airlines. Despite the passing of Co-Founder and CEO Steve Jobs, Apple enjoyed another big year and continues to prosper under the direction of Tim Cook.

The company’s annual revenues climbed to $ 108 billion, led by an 81% increase in iPhone sales — a jump that doesn’t factor in the runaway success of the iPhone 4S — and a 334% spike in iPad sales, due in no small part to the revamped iPad 2. Increased sales across the board explain why shares soared 75% during the company’s fiscal year to $ 495

With the upcoming release of the iPad 3 and an Apple TV on the horizon, Apple has a lot of room to grow, and are the odds on favorite to top Fortune’s list next year.

DON’T MISS
Report: Apple is Growing Like a Start-Up

Cult of Mac

Swedish company claims rights to ‘slide to unlock’ with new UI patent

By Mikey Campbell

Published: 06:01 PM EST (03:01 PM PST)
A patent issued to Swedish touchscreen technology company Neonode for a ‘sweep gesture’ user interface could mean legal trouble for Apple, which is currently embroiled in a ‘slide to unlock’ patent dispute with Motorola and Samsung.

In a press release issued on Tuesday, Neonode says it was issued U.S. Patent No. 8,095,879 which covers gesture-based interaction with a touch sensitive surface, a description that similar to that of Apple’s “slide to unlock” patent.

According to Neonode’s head of IP, Yossi Shain, the ’879 patent was first filed for in 2002 and the company has been shopping the technology around since the IP was issued on January 10, 2012, reports TechCrunch.

Apple is supposedly the first target for Neonode, and Shain said the company is looking for “friendly licensing” deals before pursuing patent infringement lawsuits.

Neonode claims that it has successfully marketed and sold licenses of other touchscreen patents to to a number of “tier-one” OEMs and ODMs, with the technology being used in devices such as e-readers from Sony and Barnes and Noble, according to TechCrunch.

The ’879 patent is meant to complement the Swedish company’s other U.S. Patents, No. 7,880,732 and the relating No. 8,068,101, which cover tech for small to midsize touchscreen devices. In addition, Neonode reportedly has similar patents pending in other undisclosed countries.

If Apple is indeed sued over the ’879 patent, it wouldn’t be the first time the company has seen Neonode in a court hearing. In August 2011, Samsung trotted out a relatively obscure device made by the Swedish company in defense of an Apple suit regarding “slide to unlock” functionality.

A European Windows CE handset, the Neonode N1m was shown as evidence that Apple’s claims were not inventive as the device was manufactured before the iPhone maker filed its “slide to unlock” U.S. Patent No. 7,657,849 in 2005. The Apple complaint was ultimately dismissed.

Most recently, however, Apple was successful in winning a German injunction against Motorola’ use of gesture-based device unlocking after leveraging a European counterpart to its ’849 patent.

Despite the European win, the Neonode IP could prove disruptive to Apple’s continuing legal battle against Motorola and Samsung if the Swedish company forces the Cupertino, Calif., company to pay licensing fees or takes the matter to court.

AppleInsider

Proview profiled as a company on the brink

Proview is a company that seems to be standing at the bottom of a cliff, scrabbling with broken nails trying to make it up the side. A new profile of Proview by Reuters backs up this image of a company teetering on the edge of insolvency, clinging to the “IPAD” trademark as its last, best hope of achieving financial solvency.

It’s an interesting read with some great insight into the company, which was once known for selling monitors in the late 90s. It also outlines what could happen to the group upon the outcome of the trademark dispute — now being fought on dual fronts in the U.S. and China. Even if Proview won, the company is still bankrupt in Hong Kong and faces de-listing from the stock market in June. Relationships with some key shareholders is frosty at best, with a lawsuit filed against one of them.

If Proview wins the $ 1.6 billion that local media says it seeks from Apple, it’s safe to say that most of that would be swallowed up by legal fees and paying off the creditors that Proview has owed for years.

[Via Apple Insider]



TUAW – The Unofficial Apple Weblog