The only half of the answer. Are you interpreting this as a stop to charging for Touch and start charging for iPhones and ATVs? I'm not. To me it's only about reporting iPhone and Apple TV numbers all up front- FASB. FASB HAS NOTHING TO DO WITH CHARGING FOR UPDATES- that is LAW.
Do I need to post the same part of the original artical twice to get you to read it? Maybe I will add some other emphasis for you...
Quote:
Apple lobbied heavily for the change to the generally accepted accounting principles (GAAP), citing the rules as the reason it must charge some customers nominal fees for upgrades to products like the iPod touch and Airport Extreme.
Now, I cannot say what Apple is going to do, but the implication is clearly that Apple was pushing for the rule change so it would be able to realize revenue upfront without having to charge nominal upgrade fees.
Quote:
If Apple was illegally charging then expect a lot of lawsuits demanding back for those Touch users.
Now this is just silly and does not add to the discussion. Even if accounting rules did not say anything about this, Apple would have been within its rights to charge for any update it wants to. How could charging for updates suddenly become illegal in this discussion? It seems like you are trying to find something else to argue about because you are loosing the old discussion...
The crap that the HAVE to charge for touch updates is 100% BS. Lots of companies give out free software updates. For example iTunes. Any pay for iTunes 9? Did Apple have to defer any revenue because they give iTunes away for free? No, duh!
You seem very sure of yourself. So why then doesn't Apple charge for iPhone or ATV updates?
Quote:
As for influence on the stock price, there should be none. Investors have known about this issue since the iPhone hit the market and it is easy to undo the calculation since the deferred revenue shows up on the balance sheet on day one and simply transfers to the income statement over time. If you do not understand this you should not be buying stocks without professional help.
Sort of. The deferred revenue wasn't really made clear until Apple began stating both GAAP and non-GAAP revenues in their quarterly reports, which they did not do from the start. Before then the non-GAAP revenue was a matter of estimation/speculation by those who followed the company closely.
No. Apple can now recognise all revenue for iPHONE and AppleTV up front now. That's all.
@ Techstud
I would wait for Apple to implement the change before telling everyone how Apple will implement. Apple used subscription accounting on the Iphone and did not on the Ipod. The rule change allows Apple to adjust how they will account for sales using GAAP accounting, so instead of deferring revenue and recognizing sales over the useful life of the product they can recognize the revenue and only a portion of the revenue for software upgrades would still be deferred over the useful life. This rule can be applied to any product Apple sells, not just the Iphone so Apple could easily adopt this for the Ipod or for that matter the whole Mac line. I'm sure Apple will have some guidance during their next earnings release CC, which is expected on or about the 20th of Oct.
Do I need to post the same part of the original artical twice to get you to read it? Maybe I will add some other emphasis for you...
Now, I cannot say what Apple is going to do, but the implication is clearly that Apple was pushing for the rule change so it would be able to realize revenue upfront without having to charge nominal upgrade fees.
...
Again- And where does that state that Apple will stop charging. That is your interpretation.
I would wait for Apple to implement the change before telling everyone how Apple will implement. Apple used subscription accounting on the Iphone and did not on the Ipod. The rule change allows Apple to adjust how they will account for sales using GAAP accounting, so instead of deferring revenue and recognizing sales over the useful life of the product they can recognize the revenue and only a portion of the revenue for software upgrades would still be deferred over the useful life. This rule can be applied to any product Apple sells, not just the Iphone so Apple could easily adopt this for the Ipod or for that matter the whole Mac line. I'm sure Apple will have some guidance during their next earnings release CC, which is expected on or about the 20th of Oct.
Fine and conversely you cannot state point blank that Apple will not charge going forward. ENd of story.
Coming from the same guy who told us to invest in Lehman Brothers a few months before their complete collapse. Not saying that'll happen to Apple, just wondering why this bozo is still in business I guess all I have to do to start my own show is to run around like a maniac and give incompetent advice!
Edit: Sorry, I just noticed the post above mine states the same thing
Other than the cosmetic effect of bringing Apple's reported P/E ratios from their currently lofty levels (low 30s current P/E, mid-20s forward P/E) to somewhat more reasonable level, this is a change that will have little meaningful impact over the long haul at this point.
Wu was one of the last analysts to understand the deferred accounting on Apple products. As a matter of fact most analysts did not understand it for about 3-4 quarterly periods, and that is when the volume from deferred revenue started to hit the books. For them, it was like a light bulb switching on in bright sunlight.
Fine and conversely you cannot state point blank that Apple will not charge going forward. ENd of story.
Actually I can say anything I want End of story. As far as that goes IMO Apple will not charge for upgrades to Ipod touch software because not charging builds good will and they can absorb the cost by selling more units. So for all the folks who waited when Apple activates the 80211.n and FM on the broadcomm chip in the new touch it will be a free Christmas present
Then will the updates still be free for ATV? Or has that changed? If so, why not free for the iPod Touch?
I can't believe how many people complain about this trivial, trivial thing. Especially now that it's not going to be the case anymore.
Is it your entire mission in life just to come here and find something negative to say?
Sometimes I think Apple Insider would get criticised for saying the sun rises in the morning, and Prince McClean would probably be chastised for exaggerating the degree of illumination it gave or it's exact colour. There have been a whole series of really good articles on Apple Insider lately (positive articles with lots of detail too), and all anyone seems to be able to do is blurt out some one-line complaint or gripe.
Actually I can say anything I want End of story. As far as that goes IMO Apple will not charge for upgrades to Ipod touch software because not charging builds good will and they can absorb the cost by selling more units. So for all the folks who waited when Apple activates the 80211.n and FM on the broadcomm chip in the new touch it will be a free Christmas present
And when does Apple stop charging Touch users for 3.1? Why hasn't that been taken off their website, Mr. Goodwill?
I must have missed something- when did Apple stop charging for 3.1?
I think you need to pay extra. Pay by the word. 3.1 is free for those who have knowledge. So pay up dude. As far as companies charging for products I heard Toshiba was charging $50 for people to redeem their free Windows 7 upgrade if they buy a current system so move along and complain somewhere else. You add nothing to the discussion other then trashing others ideas. If you want to read the board handout from the FASB meeting Board Meeting Handout
First of all, you most certainly can buy 7 shares at a time. You could even do it back in the bad old days of 2002. Internet discount brokers had been around for a few years. The real problem is that the stock has split three times since then. They wouldn't have been $6.80, in fact they were probably more than $50 each - but each one would now be 8 shares. Actually it might not be three splits exactly, but you get the idea.
That's a bit irrelevant if you have a time machine, though. You'd probably be going back to the '80s to buy it when it first went public. Actually, a better way to make a fortune with a time machine is just to travel to the future, get an almanac and some newspapers for the next few years, come back to the present, and make lots of guaranteed investments and sports bets. If you go back in time to invest, you have to be careful to carry period-authentic currency and such.
The problem is if time travel was possible then the future you saw may be changed by your very actions in the present. Even if that didn't happen you would have to be careful you didn't attract the attention of the wrong kinds of people with your "lucky guesses" in the world of sport betting.
One variant of the Many World theory says that instead of the universe splitting as choices are made that the universes containing all those choices already exist. If that vairent is correct then is no certainty that the future you saw is your future.
Again- you're not making sense. If they switch to the exact same non-subscription accounting as the Touch then the rules of the Touch will also apply to them. Sarbanes-Oxley requires Apple to charge Touch users for this very reason!
Think of any new iPhone OS as if you were buying a new OS for your MAc.
Plain and simple.
Kapeesh?
It's not that I can't read, it's that you don't understand.
All I have to say is these new OS upgrades better be significant for Apple to charge for them.
It seems quite obvious to me that they will still be using subscription accounting for the iPhone and the Apple TV. They'll still be setting aside a portion of the initial sale price to account for future free software updates.
The difference is that now, the proportion they set aside can be much smaller, without running afoul of the FASB rules.
Hence each iPhone sold will appear to have a much higher impact on their balance sheet in the year they sold it, increasing their revenue per share reporting (Apple shareholders win), but they will still be able to apply their (smaller) set-aside revenue towards future free software upgrades (consumers win). Everybody wins.
The question of whether or not they'll choose take advantage of the occasion of a rule change to start accounting for iPod touch sales differently... Time will tell, but I doubt it.
Quote:
Originally Posted by AIaddict
The crap that the HAVE to charge for touch updates is 100% BS.
You're absolutely right. Apple made a decision that led them to the position they're in today. They choose to account for their iPod touch sales in such a way that prevents them from giving away upgrades for free.
They could have chosen to account for the revenue in a different way, and then given away the upgrades away for free. Indeed, they made such a decision with the iPhone and with the Apple TV. But they didn't make such a decision with the iPod touch.
But, now that you have bought already your iPod touch, and they already have reported their revenue according to their previous decisions, they and you are stuck with the consequences of their decisions: charges for upgrades.
Comments
The only half of the answer. Are you interpreting this as a stop to charging for Touch and start charging for iPhones and ATVs? I'm not. To me it's only about reporting iPhone and Apple TV numbers all up front- FASB. FASB HAS NOTHING TO DO WITH CHARGING FOR UPDATES- that is LAW.
Do I need to post the same part of the original artical twice to get you to read it? Maybe I will add some other emphasis for you...
Apple lobbied heavily for the change to the generally accepted accounting principles (GAAP), citing the rules as the reason it must charge some customers nominal fees for upgrades to products like the iPod touch and Airport Extreme.
Now, I cannot say what Apple is going to do, but the implication is clearly that Apple was pushing for the rule change so it would be able to realize revenue upfront without having to charge nominal upgrade fees.
If Apple was illegally charging then expect a lot of lawsuits demanding back for those Touch users.
Now this is just silly and does not add to the discussion. Even if accounting rules did not say anything about this, Apple would have been within its rights to charge for any update it wants to. How could charging for updates suddenly become illegal in this discussion? It seems like you are trying to find something else to argue about because you are loosing the old discussion...
The crap that the HAVE to charge for touch updates is 100% BS. Lots of companies give out free software updates. For example iTunes. Any pay for iTunes 9? Did Apple have to defer any revenue because they give iTunes away for free? No, duh!
You seem very sure of yourself. So why then doesn't Apple charge for iPhone or ATV updates?
As for influence on the stock price, there should be none. Investors have known about this issue since the iPhone hit the market and it is easy to undo the calculation since the deferred revenue shows up on the balance sheet on day one and simply transfers to the income statement over time. If you do not understand this you should not be buying stocks without professional help.
Sort of. The deferred revenue wasn't really made clear until Apple began stating both GAAP and non-GAAP revenues in their quarterly reports, which they did not do from the start. Before then the non-GAAP revenue was a matter of estimation/speculation by those who followed the company closely.
No. Apple can now recognise all revenue for iPHONE and AppleTV up front now. That's all.
@ Techstud
I would wait for Apple to implement the change before telling everyone how Apple will implement. Apple used subscription accounting on the Iphone and did not on the Ipod. The rule change allows Apple to adjust how they will account for sales using GAAP accounting, so instead of deferring revenue and recognizing sales over the useful life of the product they can recognize the revenue and only a portion of the revenue for software upgrades would still be deferred over the useful life. This rule can be applied to any product Apple sells, not just the Iphone so Apple could easily adopt this for the Ipod or for that matter the whole Mac line. I'm sure Apple will have some guidance during their next earnings release CC, which is expected on or about the 20th of Oct.
Do I need to post the same part of the original artical twice to get you to read it? Maybe I will add some other emphasis for you...
Now, I cannot say what Apple is going to do, but the implication is clearly that Apple was pushing for the rule change so it would be able to realize revenue upfront without having to charge nominal upgrade fees.
...
Again- And where does that state that Apple will stop charging. That is your interpretation.
@ Techstud
I would wait for Apple to implement the change before telling everyone how Apple will implement. Apple used subscription accounting on the Iphone and did not on the Ipod. The rule change allows Apple to adjust how they will account for sales using GAAP accounting, so instead of deferring revenue and recognizing sales over the useful life of the product they can recognize the revenue and only a portion of the revenue for software upgrades would still be deferred over the useful life. This rule can be applied to any product Apple sells, not just the Iphone so Apple could easily adopt this for the Ipod or for that matter the whole Mac line. I'm sure Apple will have some guidance during their next earnings release CC, which is expected on or about the 20th of Oct.
Fine and conversely you cannot state point blank that Apple will not charge going forward. ENd of story.
Look what Jim Kramer says!
http://www.benzinga.com/craig-jones/...l-skyrocket-50
And, we should care about this blowhard why?
Look what Jim Kramer says!
http://www.benzinga.com/craig-jones/...l-skyrocket-50
Coming from the same guy who told us to invest in Lehman Brothers a few months before their complete collapse. Not saying that'll happen to Apple, just wondering why this bozo is still in business
Edit: Sorry, I just noticed the post above mine states the same thing
Fine and conversely you cannot state point blank that Apple will not charge going forward. ENd of story.
Actually I can say anything I want End of story. As far as that goes IMO Apple will not charge for upgrades to Ipod touch software because not charging builds good will and they can absorb the cost by selling more units. So for all the folks who waited when Apple activates the 80211.n and FM on the broadcomm chip in the new touch it will be a free Christmas present
Then will the updates still be free for ATV? Or has that changed? If so, why not free for the iPod Touch?
I can't believe how many people complain about this trivial, trivial thing. Especially now that it's not going to be the case anymore.
Is it your entire mission in life just to come here and find something negative to say?
Sometimes I think Apple Insider would get criticised for saying the sun rises in the morning, and Prince McClean would probably be chastised for exaggerating the degree of illumination it gave or it's exact colour. There have been a whole series of really good articles on Apple Insider lately (positive articles with lots of detail too), and all anyone seems to be able to do is blurt out some one-line complaint or gripe.
Actually I can say anything I want End of story. As far as that goes IMO Apple will not charge for upgrades to Ipod touch software because not charging builds good will and they can absorb the cost by selling more units. So for all the folks who waited when Apple activates the 80211.n and FM on the broadcomm chip in the new touch it will be a free Christmas present
And when does Apple stop charging Touch users for 3.1? Why hasn't that been taken off their website, Mr. Goodwill?
I can't believe how many people complain about this trivial, trivial thing. Especially now that it's not going to be the case anymore.
. .
I must have missed something- when did Apple stop charging for 3.1?
Wow, €100,000,000? That's a lot of US dollars. How's the tax on winnings, though?
Tax-free. $147,735,000
There was one winner, not Irish. Though an Irish person did win it about 3 years ago when it was €111,000,000 ($163,503,000)
Look what Jim Kramer says!
http://www.benzinga.com/craig-jones/...l-skyrocket-50
No thanks.
I must have missed something- when did Apple stop charging for 3.1?
I think you need to pay extra. Pay by the word. 3.1 is free for those who have knowledge. So pay up dude. As far as companies charging for products I heard Toshiba was charging $50 for people to redeem their free Windows 7 upgrade if they buy a current system so move along and complain somewhere else. You add nothing to the discussion other then trashing others ideas. If you want to read the board handout from the FASB meeting Board Meeting Handout
First of all, you most certainly can buy 7 shares at a time. You could even do it back in the bad old days of 2002. Internet discount brokers had been around for a few years. The real problem is that the stock has split three times since then. They wouldn't have been $6.80, in fact they were probably more than $50 each - but each one would now be 8 shares. Actually it might not be three splits exactly, but you get the idea.
That's a bit irrelevant if you have a time machine, though. You'd probably be going back to the '80s to buy it when it first went public. Actually, a better way to make a fortune with a time machine is just to travel to the future, get an almanac and some newspapers for the next few years, come back to the present, and make lots of guaranteed investments and sports bets. If you go back in time to invest, you have to be careful to carry period-authentic currency and such.
The problem is if time travel was possible then the future you saw may be changed by your very actions in the present. Even if that didn't happen you would have to be careful you didn't attract the attention of the wrong kinds of people with your "lucky guesses" in the world of sport betting.
One variant of the Many World theory says that instead of the universe splitting as choices are made that the universes containing all those choices already exist. If that vairent is correct then is no certainty that the future you saw is your future.
Again- you're not making sense. If they switch to the exact same non-subscription accounting as the Touch then the rules of the Touch will also apply to them. Sarbanes-Oxley requires Apple to charge Touch users for this very reason!
Think of any new iPhone OS as if you were buying a new OS for your MAc.
Plain and simple.
Kapeesh?
It's not that I can't read, it's that you don't understand.
All I have to say is these new OS upgrades better be significant for Apple to charge for them.
It seems quite obvious to me that they will still be using subscription accounting for the iPhone and the Apple TV. They'll still be setting aside a portion of the initial sale price to account for future free software updates.
The difference is that now, the proportion they set aside can be much smaller, without running afoul of the FASB rules.
Hence each iPhone sold will appear to have a much higher impact on their balance sheet in the year they sold it, increasing their revenue per share reporting (Apple shareholders win), but they will still be able to apply their (smaller) set-aside revenue towards future free software upgrades (consumers win). Everybody wins.
The question of whether or not they'll choose take advantage of the occasion of a rule change to start accounting for iPod touch sales differently... Time will tell, but I doubt it.
The crap that the HAVE to charge for touch updates is 100% BS.
You're absolutely right. Apple made a decision that led them to the position they're in today. They choose to account for their iPod touch sales in such a way that prevents them from giving away upgrades for free.
They could have chosen to account for the revenue in a different way, and then given away the upgrades away for free. Indeed, they made such a decision with the iPhone and with the Apple TV. But they didn't make such a decision with the iPod touch.
But, now that you have bought already your iPod touch, and they already have reported their revenue according to their previous decisions, they and you are stuck with the consequences of their decisions: charges for upgrades.
Tax-free. $147,735,000
There was one winner, not Irish. Though an Irish person did win it about 3 years ago when it was ?111,000,000 ($163,503,000)
Good grief... Could be worth a trip over just for a chance at that loot.