thompr

JP234 said:

macxpress said:

JP234 said:

genovelle said:

I bet Steve Balmer winces every time he reads his quote saying the iphone had no chance of gaining significant market share. 

I'm sure he's crying all the way to the bank. One of the ones he owns.

Maybe he's not, but I bet Microsoft is. He's the exact reason why Microsoft was completely left out of the smartphone space. He never took its competitors seriously and when you have companies like Apple entering your space you damn well better sit up straight and pay attention. 

Suppose you'd invested $1,000 in Microsoft on June 29, 2007, when the iPhone was introduced. What do you suppose it would be worth today?

At Friday's market close, that would now be $20,703.70.

Of course, by calculating the same metric, $1,000 in Apple on that day is now worth (are you sitting down?): $1,206,333.33

I doubt Microsoft is crying. But I bet Apple is popping the corks on Dom Perignon Vintage 2007! (BTW, it's because, adjusted for splits, Apple stock was worth 15¢/share on the day the iPhone was introduced. Microsoft was worth $16.20, over 100 times as much as Apple). Each currently have a market cap. approaching $3 trillion. Put away the kleenex!

It seems like you looked up AAPL's share price in June of 2007 and then divided by 28.  That would be the right thing to do, since there have been two stock splits since then, one of them 4-1 and the other 7-1.

So you looked it up and found that it was about 4 dollars and change.  Then you divided by 28 to get your value of 15 cents.

The problem is whatever you used to look it up had already accounted for the splits.  The 4 dollars and change was already split-equivalent.  (The price of the pre-split shares on that day was in the mid-120's.)

So the stock has essentially grown by a factor of:    $180(ish) divided by $4.50(ish) = 40(ish)

So if you had invested $1000 on that a day, you would now have somewhere in the neighborhood of $40,000, not $1.2 M.

You accounted for the 28-1 split twice.

twolf2919 said:

Price is THE decider on whether this headset will be a success.  This author - and others who’ve made the same point that Apple has had supposed failures many times before turn into successes - doesn’t seem to realize this.  When has Apple *ever* introduced a completely new product category at an initial price point of $3k?  Maybe the original Apple 2 (adjusted for inflation) - but nothing since then.   Sure, there are several niche “pro” products in THS range and beyond, but nothing with hoped for mass market appeal.  And  Apple clearly wants this to eventually become the next iPhone.  And I think the AR glasses originally promised for this timeframe had/has this potential - but not some dorky headset costing as much as a used car.

If we define "mass market appeal" and "success" such that Apple needs to sell a hundred million units per year right out of the gate, then no doubt you are correct.  But I believe there might be a market for ten million units, even at $3000, if the device is compelling enough. Here's my reasoning...

There is a VERY large set of people that eat/drink/sleep everything Apple.  There is a large set of people with enough disposable income such that $3000 is not a big deal.  There is a smaller set of people that are technophiles who desire everything that's perceived as cool and cutting-edge.  Assuming the device is cool enough to interest those technophiles, then I think the initial wave of buyers will belong to the intersection of these 3 sets.  My hunch is that there are enough people in the intersection that Apple's main problem will be supply at first.  The units will sell out and remain sold out until that set of people is satisfied.  If the rumored challenges with manufacture are true, then there might be unmet demand for quite some time.

From the business perspective, having unmet demand is problematic.  But it's a good problem to have relative to the reverse.  You have a great chance of solving it by throwing money and time at it (unless there are intractable manufacturing challenges).

You probably agree with me so far, but you might be asking the important question, "yeah, but what about AFTER the initial wave of buyers is satisfied?".  Good question , sir!

To me, the question of whether this headset experiences CONTINUED success (i.e. after the initial wave) is whether the device is actually compelling enough to reach beyond the technophiles.  The worldwide intersection of the first two sets above is large indeed, so if you can reach past the technophiles, then success will come even at the rumored $3000 asking price.  I know this because I, myself, am in the first two sets but not the 3rd.  I will be watching very closely on Monday, and if I see something that's clearly better than what we've seen before (from Meta, et. al.) then there's a decent chance I'll preorder one whenever possible.  And I don't think I'm unique in terms of Apple-love and disposable income.  There are tens of millions of "me"s around the world.  Maybe a hundred million.

Since Apple has been working on this thing for the better part of a decade, and since the ARKit for developers has been available for many years too, I'm not going to bet against Apple releasing a product that reaches beyond technophiles.  If they can, then I think they will have a product that can move 10 M units yearly.  That's $30 billion in revenue.  

That's a success in my book.

David H Dennis said:

I wonder how this will work, since all the satellite services I know of require a dish — which is certainly not portable equipment.  

Also I wonder how much this service would cost, and whether it’s a first step to introducing an Apple cell carrier, which I would think would be an almost guaranteed success if service isn’t awful.

Certainly Apple’s level of customer loyalty is far, far higher than Verizon’s will ever be.

All of the satellite services that require dishes use satellites in Geosynchronous orbit, which is approximately 40,000 km out from Earth's center.  Low earth orbit is 2,000 km or less, meaning 1/20th of the distance... translating to 1/400th of the power requirements (each way).  Still, it would be quite a feat to make the uplink work.

gatorguy said:

...and then Apple failed at that task, with none of that decided in this court case even tho that was a supposed goal and focus. Settled before it ever began. It all came down to money. That's actually a real issue with real effects. "Android the big loser because Apple and QC are back in a bromance" is a made-up one.  

You do not know whether Apple failed or not.  The settlement the two companies reached may have addressed all of those issues, both in terms of the one-time payment (from disputes over past royalties & promises) as well as their future chip deals (potentially no double-dipping, etc).  I don't know either.  But given the fierceness Apple has always shown in its negotiations (some deals have been revealed after the fact)... if I were forced to place a bet regarding whether Apple took a chunk out of what Qualcomm was hoping for, I would bet "yes".

OK, so you might say that even if my bet were correct, then Apple was only successful with regard to cash but not with regard to "being the hero" for the community against Qualcomm's licensing practices.  You don't know that either.  There are still several court cases brought by multiple governments against Qualcomm.  I also don't know, but my hunch is that by now there is little else Apple could reveal in those cases that they haven't already revealed.  So Apple has played its "hero card" about as far as it could go from that standpoint.

The bottom line is that I believe Apple probably came out of this settlement with much nicer terms going forward (and potentially reduced payment for what occurred before) and that Qualcomm's licensing practices with many of their customers are still under the microscope and will possibly have to be revisited going forward.

steveh said:

Microsoft's "saving" Apple was hardly done out of altruism, nor did it cost Microsoft anything in the long term.

In 1997, Microsoft bought 150,000 shares of Apple preferred stock, convertable to common shares of Apple stock at a price of $8.25, redeemable after a three year period, for $150 million. Apple was worth ~ $3B at the time.

By 2001, they'd converted all of the shares into common stock, netting the company approximately 18.1 million shares. 

By 2003, they'd sold all of it.

It was mostly optics.

As part of that deal, there was a much more important thing that Microsoft signed up for: they pledged to continue developing and shipping Microsoft Office for the Mac for several more years.  If they had gone through with their plan of abandoning the Mac at that time, when Apple was near death, I dare say that may have put the final nail in the coffin.