Apple focusing its business segments around Mac OS X - analyst

Posted:
in iPod + iTunes + AppleTV edited January 2014
While some industry watchers have argued that Apple is diversifying its business too dramatically, analysts at investment research firm Piper Jaffray said Wednesday they believe the company is actually preparing to more closely focus its business and consumer electronics segments around the central core of its Mac OS X operating system.



Reacting to Apple's just-announced media event next Wednesday, analyst Gene Munster and his research team said the Cupertino-based firm appears ripe to usher in its holiday iPod offerings during the event, which are likely to include radical redesigns of the flagship video iPod and iPod nano.



"We expect that the new pods will be based on a modified version of Apple's operating system, OS X. Currently, Macs, the iPhone, and Apple TV run on OS X, and with these OS X-based iPods, Apple would have an entire line of consumer electronics products based on OS X," Munster wrote in a note to clients. "Instead of diversifying its business too dramatically, as some have argued, we believe Apple is focusing its business."



A third-generation iPod nano is likely to include video capabilities, a wider viewing display, and come in five new colors, the analyst said. However, he isn't expecting major advancements in storage capacity, which he believes will remain at 2GB to 8GB. He added that Apple will likely maintain its lowest price point of $149 for the new nanos.



Meanwhile, Munster said he's less certain about the specifications of a sixth-generation iPod video player, but believes there is a 70 percent likelihood Apple will finally unveil a widescreen, mutli-touch model akin to the iPhone.



"It may also have WiFi capability and the capacity could be as high as 160GB," he told clients. "Apple will likely raise the lowest iPod price point back up to $299 (from $249). The fifth-gen iPod is the longest-lasting iPod model ever; it was released nearly 2 years ago and refreshed with high capacities and a lower price last September."



Speaking more generally in his note to clients Wednesday, the Piper Jaffray analyst also emphasized his belief that Apple is entering the two strongest quarters in company history.



"With new iMacs ahead of the education buying season, we believe Apple may see upside to our estimate of 1.9 million Macs in the September quarter," he wrote. "Likewise, if Apple announces new iPods on September 5, they would be well-timed for the critical holiday shopping season, possibly providing upside to our estimate of 22 million iPods in the December quarter."



Munster maintained his "Outperform" rating on shares of Apple with a price target of $211 a share.
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Comments

  • Reply 1 of 29
    Same storage capacity? WTF really, does anyone else believe this? Hard to imagine that Apple is about to intro a 2gb nano replacement.
  • Reply 2 of 29
    mactelmactel Posts: 1,275member
    Quote:
    Originally Posted by 128pluspb100siduo230 View Post


    Same storage capacity? WTF really, does anyone else believe this? Hard to imagine that Apple is about to intro a 2gb nano replacement.



    I doubt it would be the same storage. If they come out with the wide screen iPod then you need more storage for the video. Apple knows that like we do.



    I'm just interested in seeing OSX on an iPod Shuffle with a screen to boot.
  • Reply 3 of 29
    sandausandau Posts: 1,230member
    Quote:
    Originally Posted by MacTel View Post


    I'm just interested in seeing OSX on an iPod Shuffle with a screen to boot.



    first time i read that i thought you meant boot from your iPod shuffle. hehe.
  • Reply 4 of 29
    onlookeronlooker Posts: 5,252member
    I think that analyst is talking out his ass. It doesn't even make sense to put OS X on an iPod right now.
  • Reply 5 of 29
    iqatedoiqatedo Posts: 1,822member
    I've said before that I'd like to have an EPIC Mac. Perhaps Apple is heading that way, leveraging more the operating system and less particular hardware implementations. The Mac Mini is almost there but as far as I know, doesn't give one access to the sort of digital and analogue I/O of a true EPIC. Perhaps the USB port is good enough for that though with the addition of high-speed analogue and digital boxes plugged in.
  • Reply 6 of 29
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by 128pluspb100siduo230 View Post


    Same storage capacity? WTF really, does anyone else believe this? Hard to imagine that Apple is about to intro a 2gb nano replacement.



    Piper Jaffray has been pretty accurate lately, but I can't imagine new Nanos without increased capacity.



    I also don't see how OS X will run on a Nano with such a slow ARM processor and low RAM. It would just run too damn slow.



    I also don't see Apple using the 160GB HDDs. 120GB would be the max they'd utilize.
  • Reply 7 of 29
    Quote:
    Originally Posted by onlooker View Post


    I think that analyst is talking out his ass. It doesn't even make sense to put OS X on an iPod right now.



    Huh? you're not expecting an iPhone like experience then? Just increased storage? No (touch-) widescreen? I'm very intrigued now, what makes you believe that?
  • Reply 8 of 29
    onlookeronlooker Posts: 5,252member
    #1 I don't think an iPod needs a touch screen to operate, It has a proven interface, and #2 Apple just paid off creative with 100 million dollars to keep using the iPod interface indefinitely. I don't think they need to pay them 100 million to let them keep using it if they were planning on changing it immediately after - it makes no sense. And it just doesn't make sense to have a touch screen on an iPod anyway. You don't need it. Why add all that cost to a low cost item? The less they cost the more popular they will become. THey may have one high end model that could have it, but I still don't see a absolute need for it.
  • Reply 9 of 29
    zandroszandros Posts: 537member
    Quote:
    Originally Posted by IQatEdo View Post


    I've said before that I'd like to have an EPIC Mac. Perhaps Apple is heading that way, leveraging more the operating system and less particular hardware implementations. The Mac Mini is almost there but as far as I know, doesn't give one access to the sort of digital and analogue I/O of a true EPIC. Perhaps the USB port is good enough for that though with the addition of high-speed analogue and digital boxes plugged in.



    EPIC Mac? Not that I would say no, but why do you want a Mac running Itanium?



    /Adrian
  • Reply 10 of 29
    iqatedoiqatedo Posts: 1,822member
    Quote:
    Originally Posted by Zandros View Post


    EPIC Mac? Not that I would say no, but why do you want a Mac running Itanium?



    /Adrian



    Good one! Not the Itanium EPIC architecture, the Embedded Platform for Industrial Computing EPIC!



    All the best.
  • Reply 11 of 29
    I think that this article is really about taking on Microsoft in the OS wars (and winning). With more diverse devices being run on a version of OS X, Apple is competing with all the different varieties of Windows such as Windows Mobile and Windows Media Center.



    They will prove that devices running Apple's OS X not only have a more stable underlying architecture, but also a more beautiful and intuitive user interface.



    This is a big deal.



    Oh, and I would love to have a touch-screen iPod with Wi-Fi. Please.
  • Reply 12 of 29
    melgrossmelgross Posts: 33,510member
    Quote:
    Originally Posted by neudesign View Post


    I think that this article is really about taking on Microsoft in the OS wars (and winning). With more diverse devices being run on a version of OS X, Apple is competing with all the different varieties of Windows such as Windows Mobile and Windows Media Center.



    They will prove that devices running Apple's OS X not only have a more stable underlying architecture, but also a more beautiful and intuitive user interface.



    This is a big deal.



    Oh, and I would love to have a touch-screen iPod with Wi-Fi. Please.



    I don't know about winning, but, yes, I've been saying that same thing. This a plan to move X into a much more widely used space.



    The only problem with the plan is that the interface is so different, most people won't realize that they are using X.



    MS was smart to make their mobile OS look like Windows, even though doing that slows down the entire device. It gives comfort to people who want Windows everywhere, even though the OS has nothing in common with Windows, code-wise, and is not compatible with any of the programs.



    Apple's phone "desktop", on the other hand, looks, and acts, nothing like our familiar desktop. That means that people don't think they are having a similar experience, and causing program rewrites to be almost as difficult as coming up with a new program for Windows Mobile (assuming, of course, that third party programming moves to a higher level).
  • Reply 13 of 29
    mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by melgross View Post


    MS was smart to make their mobile OS look like Windows, even though doing that slows down the entire device. It gives comfort to people who want Windows everywhere, even though the OS has nothing in common with Windows, code-wise, and is not compatible with any of the programs.



    True the OS itself does not share much code however when writing applications in .Net there is considerable reuse of code possible for desktop and mobile versions.



    m
  • Reply 14 of 29
    Quote:
    Originally Posted by onlooker View Post


    I think that analyst is talking out his ass. It doesn't even make sense to put OS X on an iPod right now.



    So why do you care? What support do you hold that makes it contrary to your opinion?



    These guys make a living by researching/analyzing the data and making stock recommendations to their clients to buy, sell or hold. They get it wrong and they lose customers; enough of that and it's goodbye.



    True, you have a right to your opinion. But until you provide evidence to the contrary, you are talking out of your ass.
  • Reply 15 of 29
    Quote:
    Originally Posted by dutch pear View Post


    Huh? you're not expecting an iPhone like experience then? Just increased storage? No (touch-) widescreen? I'm very intrigued now, what makes you believe that?



    Touchscreen would be OK, but not really necessary, and a slightly larger screen (not as big as the iPhone, to save battery power) would be fine.



    I think the interface could use a little refinement... not a LOT of refinement.



    And I see no point to putting OSX on an iPod unless they are going with a larger form-factor, making it more like a personal planner with the added functionality of the iPod. A personal planner, an iPod, a wireless garage door opener! A PERSONAL PLANNER, AN IPOD, A WIRELESS...



  • Reply 16 of 29
    jwdawsojwdawso Posts: 389member
    Quote:
    Originally Posted by onlooker View Post


    I think that analyst is talking out his ass. It doesn't even make sense to put OS X on an iPod right now.



    Steve Jobs stated (Apple Town Hall meeting notes) that iPods with OS X are coming, and given the context, now seems the right time.
  • Reply 17 of 29
    Quote:
    Originally Posted by melgross View Post


    The only problem with the plan is that the interface is so different, most people won't realize that they are using X.



    MS was smart to make their mobile OS look like Windows, even though doing that slows down the entire device. It gives comfort to people who want Windows everywhere, even though the OS has nothing in common with Windows, code-wise, and is not compatible with any of the programs.



    Apple's phone "desktop", on the other hand, looks, and acts, nothing like our familiar desktop. That means that people don't think they are having a similar experience, and causing program rewrites to be almost as difficult as coming up with a new program for Windows Mobile (assuming, of course, that third party programming moves to a higher level).



    I don't think it matters if people realize they're using the same OS underneath. Apple is more concerned with providing the best possible UI for the given form factor, rather than trying to squeeze a desktop UI into a tiny device. I honestly don't think that getting OS X into many devices is intended to be a "Windows Everywhere" type marketing push at all. Sure, they mention it to get the geeks in a huff, and to maybe push the security angle on devices like the iPhone, but it doesn't matter one bit from a consumer point of view. Do you care what software is running in your microwave? Apple wants to push the "Apple" brand to their consumers, not so much the "OS X' brand. If you love your iPhone, you'll want to buy a Mac, not because they're running the same OS, but because they're made by the same company and you like their products.



    How is it good for Apple though? It means they only have to write the core OS for all of their products once, and then make the relatively small device-specific tweaks on top of it. That means that the price of developing all of their fancy technologies and libraries is spread out across a number of different product lines, rather than having to write and test the same kind of stuff over and over. Whereas they used to have to absorb the price of developing OS X through their Mac sales (and boxed OS X sales), it is also now being directly subsidized through AppleTV, iPod, and iPhone.
  • Reply 18 of 29
    kickahakickaha Posts: 8,760member
    BINGO.



    Instead of associating OS X with an *interface* (which is going to change over time), they're associating it with *attributes*: stability, security, ease of use.



    Not *a* particular interface, but easy to use interfaces geared towards the device in question... this is an important distinction.



    MS has long marketed to the interface - even when having that same interface makes zero sense whatsoever (Windows Mobile, IMO). They figured people wouldn't care what was under the hood, as long as it looked the same, even if it was harder to use.



    Well, people do care about what 'under the hood' can offer them... and Apple is offering OS X (*NOT* MacOS X, mind you, but a nice little kernel with extensibility and flexibility) as a solution for the issues that most consumers are worried about in their computer products: security, etc.



    So when they hear that the iPhone is running OS X, they (hopefully) think of stability and security. Then they see the interface, use it, and don't give a rat's ass that it doesn't look just like MacOS X - it makes sense for the device they bought.



    As usual, MS focused on the surface glitz, and forgot to get their ducks in a row behind the scenes. They're betting that a singular UI and a... um... catalog of APIs will make users and developers happy. Not so much, so far.



    Apple is betting that having a single engine driving everything, and customizing the UI for the devices being offered to make each one highly usable, is the way to go. They get a huge win in development costs, and they can *nimbly* enter new markets in the consumer space ad hoc. The average consumer couldn't give a rat's ass if their new phone runs Windows Mobile, Palm, OS X, or ZOMGOS... they just want it to work at what it advertises itself to do, without too much pain.



    Gotta hand it to Apple on this one, it's a gutsy move that turns the 'conventional wisdom' of the industry on its head. Again.
  • Reply 19 of 29
    "Meanwhile, Munster said he's less certain about the specifications of a sixth-generation iPod video player, but believes there is a 70 percent likelihood Apple will finally unveil a widescreen, mutli-touch model akin to the iPhone."



  • Reply 20 of 29
    Exactly what Kickaha said...



    ... using OSX (the OS, not the entire UI) in as many areas as possible.



    Then developing/refining the interface that sits on the OS as it applies to that particular device.



    Not trying to make it look like the UI on the Mac, but possibly using SOME of the UI pieces on certain devices.



    Brilliant, IMHO.
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