Analyst projects as many as 1.5m hacked iPhones in use
With more than 25 percent of total iPhone sales potentially in the hands of customers who don't subscribe to AT&T, investors should look to pure unit shipments rather than carrier numbers as a gauge for iPhone success, according to a note from American Technology Research.
Analyst Shaw Wu cites estimates that suggest "at least" 1 million and as many as 1.5 million iPhones are currently in use with an unauthorized provider, exceeding claims by BusinessWeek sources that estimated 1 million hacked units at a maximum. The phone is most likely in unofficial service in between 35 and 40 countries versus the official four, Wu reckons.
The discrepancy may be wide enough to mask underperformance in official numbers, with AT&T's official subscriptions and overall shipments both relatively low. While predictions at the research firm call for an above-consensus 2.1 million iPhones to ship in the first calendar quarter of 2008, it may be the up-front price for the device and not its shared subscription revenue that carries the day.
"We are not sure if looking at AT&T additions is the right way to measure sales as we believe the hacked iPhone market is much larger than expected," Wu says.
Instead, Apple's current success is said to be measurable through the $399 in revenue collected from each phone as well as first-party accessory sales. The Cupertino, Calif.-based firm also is not as heavily dependent on the iPhone for revenue: having accounted for just 3 percent of Apple's latest quarterly revenue, even a complete shutdown of iPhone sales would result in just a 3-cent drop in Apple's earnings per share, the analyst says.
Mac sales may help soften any perceived blow. Though iPod shipments may be weak during the current quarter, with a steep seasonal decline dropping sales to an estimated 9.7 million units, the MacBook Air is believed to be boosting traffic both for Mac sales and for retail stores. Despite "underwhelming" numbers, the MacBook Air could help Apple reach 2.1 million Macs sold in the first three months of the year.
The larger picture leads American Technology to predict that Apple will track above its own financial guidance and has buffered itself against a recession.
"We continue to believe AAPL is well-positioned to weather the storm better than most with its strong fundamentals," Wu notes.
Analyst Shaw Wu cites estimates that suggest "at least" 1 million and as many as 1.5 million iPhones are currently in use with an unauthorized provider, exceeding claims by BusinessWeek sources that estimated 1 million hacked units at a maximum. The phone is most likely in unofficial service in between 35 and 40 countries versus the official four, Wu reckons.
The discrepancy may be wide enough to mask underperformance in official numbers, with AT&T's official subscriptions and overall shipments both relatively low. While predictions at the research firm call for an above-consensus 2.1 million iPhones to ship in the first calendar quarter of 2008, it may be the up-front price for the device and not its shared subscription revenue that carries the day.
"We are not sure if looking at AT&T additions is the right way to measure sales as we believe the hacked iPhone market is much larger than expected," Wu says.
Instead, Apple's current success is said to be measurable through the $399 in revenue collected from each phone as well as first-party accessory sales. The Cupertino, Calif.-based firm also is not as heavily dependent on the iPhone for revenue: having accounted for just 3 percent of Apple's latest quarterly revenue, even a complete shutdown of iPhone sales would result in just a 3-cent drop in Apple's earnings per share, the analyst says.
Mac sales may help soften any perceived blow. Though iPod shipments may be weak during the current quarter, with a steep seasonal decline dropping sales to an estimated 9.7 million units, the MacBook Air is believed to be boosting traffic both for Mac sales and for retail stores. Despite "underwhelming" numbers, the MacBook Air could help Apple reach 2.1 million Macs sold in the first three months of the year.
The larger picture leads American Technology to predict that Apple will track above its own financial guidance and has buffered itself against a recession.
"We continue to believe AAPL is well-positioned to weather the storm better than most with its strong fundamentals," Wu notes.
Comments
The larger picture leads American Technology to predict that Apple will track above its own financial guidance ...
golly, that's a bold prediction
flip-flop, flip-flop. Just a couple of weeks ago these same analysts put these phones in-channel, and unsold. Now their selling like hotcakes. Oh well.
may be that is related to recent software unlock available for 1.1.2 and 1.1.3 BL 4.9
How the hell are you gonna count that? impossible. Just because iphone is not activated with att, it does not mean that the phone is hacked..
Makes you wonder what it takes to call yourself an "analyst".
Ask Apple for the real numbers. And if Steve Jobs doesn't want to reveal the great secret, just say so, don't speculate!
...investors should look to pure unit shipments rather than carrier numbers as a gauge for iPhone success, according to a note from American Technology Research.
Why, exactly, wasn't the plan for tracking iPhone revenue, right out of the gate, not based on revenue per unit, plus whatever CONFIRMED at&t revenue sharing they had? All parties involved must have been keenly aware that they were not locking out use on other carriers forever, and that this would happen? Not saying they knew how big it would be, but they knew some would do it.
You know.. some people buy iphone just for the ipod and the wifi. Meaning they are not activating it at all. Its possible. and i dont think thats a hack..
How the hell are you gonna count that? impossible. Just because iphone is not activated with att, it does not mean that the phone is hacked..
The iPod Touch can do that in a thinner case and with more space for the same money. The screen is a dithering one vs. the iPhone's better non-dithering display, but people don't seem to notice that kind of thing anyway.
I have not seen anyone that could use the iPhone not activated and not hacked. The story I remember was that it could only be used to make 911 calls, no iPod, WiFi or PDA functionality was available until you activate or hack it. I haven't heard of that changing either.
flip-flop, flip-flop. Just a couple of weeks ago these same analysts put these phones in-channel, and unsold. Now their selling like hotcakes. Oh well.
No, this is from Shaw Wu at American Technology Research. The previous stories covered other analysts, and as such, it's not flip-flopping. You can't reasonably expect them to all be homogeneous.
Piper Jaffray's Gene Munster:
http://www.appleinsider.com/articles...n_channel.html
Toni Sacconaghi of Bernstein Research:
http://www.appleinsider.com/articles...m_iphones.html
RBC Capital analyst Mike Abramsky:
http://www.appleinsider.com/articles..._insiders.html
If you have link to a story where Shaw Wu said something different on this subject a few weeks, I'd like to see it.
No, this is from Shaw Wu at American Technology Research. The previous stories covered other analysts, and as such, it's not flip-flopping. You can't reasonably expect them to all be homogeneous.
Piper Jaffray's Gene Munster:
http://www.appleinsider.com/articles...n_channel.html
Toni Sacconaghi of Bernstein Research:
http://www.appleinsider.com/articles...m_iphones.html
RBC Capital analyst Mike Abramsky:
http://www.appleinsider.com/articles..._insiders.html
If you have link to a story where Shaw Wu said something different on this subject a few weeks, I'd like to see it.
Nope, you are correct, my bad. Although, in my defense they are typically a herd animal and tend to run together.
golly, that's a bold prediction
Wu should predict that Apple's predictions for the next quarter will be less than what the analysts predicted that Apple would predict.
Therefore, when Apple's predictions are in fact less than the analysts predicted Apple would predict, Wu's prediction will be correct and the stock price will rise, since Apple met Wu's prediction by predicting less than the analysts predicted they would predict.
Wu should predict that Apple's predictions for the next quarter will be less than what the analysts predicted that Apple would predict.
Therefore, when Apple's predictions are in fact less than the analysts predicted Apple would predict, Wu's prediction will be correct and the stock price will rise, since Apple met Wu's prediction by predicting less than the analysts predicted they would predict.
Now, that is great analysis.
I too predict, therefore, that the stock with go up. And, if it does not, it will go down.
Now, that is great analysis.
I too predict, therefore, that the stock with go up. And, if it does not, it will go down.
I predict that that's an accurate prediction, with the added possibility that it stays the same.
Ok, call me naive,
why not just get an iPod Touch that looks the same for a lower price?.
Remind yourself of when the iPhone went on sale and when the iPod Touch went on sale. Millions of buyers bought the iPhone in that space of time. Millions.
Wu confirms exactly what I expected to see. In fact, I think these numbers are still fairly low (See my posts from yesterday on the iPhone). My guess is that 1 in 3 iPhones might be unlocked (and/or un-activated).
When the 3G iPhone ships, expect these numbers to grow, perhaps exponentially. Remember, 3G is widely available outside the US, and customers in these countries EXPECT their handsets to be unlocked. We in the US are fairly unique in our taste for whatever carriers want to offer (read locked phones).
Apple has a huge problem on their hands in regard to their agreement with ATT. Crackdowns are imminent, but will they work? Will any locking measures work? All I have to say is, Unlock the iPhone, Apple.
Remind yourself of when the iPhone went on sale and when the iPod Touch went on sale. Millions of buyers bought the iPhone in that space of time. Millions.
That was a span of only two months. During that time, there wasn't a huge discrepancy between sold vs. activated. I think that was just over one million total sold.
And there are probably thousands of stores all over the world selling them. I heard you can buy iPhones in Canada with no official carrier too.
That was a span of only two months.
Double check your dates.