Firm: Apple to ship $4.2B in wireless iPods by 2010
New research carried out by the independent research provider, Generator, illustrates that Apple's iPod business could soon give second-tier mobile phone makers a run for their money.
"A lot of people don't realise that Apple's iPod business is already bigger than Sony Ericsson. What's more, Apple is the market leader in a growth market while Sony Ericsson is a second-tier player in a mature industry," said Andrew Sheehy, Research Director at the firm.
According to Sheehy, Apple's scale now means that the company can go out and negotiate deals with suppliers of miniature cameras, video recorders and wireless modems -- items normally used in mobile phones -- that are competitive with what many mobile handset makers can secure.
"Things change when you're buying in that sort of volume. A lot of people who supply components for use in mobile handsets are licking their chops right now: there's lots of new business up for grabs and we know that people are talking to Apple right now about doing this," said Sheehy.
Although Wi-Fi modems could be used instead, the report explains that the best way to implement a wireless iPod would be via wholesale data agreements with one mobile operator in each iTunes market.
Apart from being able to take pictures and shoot movies with their wireless iPods, users could wirelessly publish their self-generated digital content on iTunes, the firm speculates.
"The mobile content side is interesting but you could also offer knock-out voice service with this approach -- Apple could offer free WiPod to WiPod calls, using a Skype-like software application. A lot of people in the mobile industry will be worried when this starts happening," Sheehy added.
Last month, iPod chipmaker PortalPlayer said it had teamed with wireless solutions provider CRS to deliver Wi-Fi and Bluetooth connectivity on its next-generation system-on-chip scheduled to make its debut in the second half of the year.
The San Jose, Calif.-based PortalPlayer, whose system-on-chip audio controllers have been a fixture in the iPod since its inception, currently supplies Apple with chips for all varieties of the digital music player with the exception of the low-end iPod shuffle.
This news has brought on industry speculation that Apple could launch its first wireless iPods in late 2006 or early 2007.
"A lot of people don't realise that Apple's iPod business is already bigger than Sony Ericsson. What's more, Apple is the market leader in a growth market while Sony Ericsson is a second-tier player in a mature industry," said Andrew Sheehy, Research Director at the firm.
According to Sheehy, Apple's scale now means that the company can go out and negotiate deals with suppliers of miniature cameras, video recorders and wireless modems -- items normally used in mobile phones -- that are competitive with what many mobile handset makers can secure.
"Things change when you're buying in that sort of volume. A lot of people who supply components for use in mobile handsets are licking their chops right now: there's lots of new business up for grabs and we know that people are talking to Apple right now about doing this," said Sheehy.
Although Wi-Fi modems could be used instead, the report explains that the best way to implement a wireless iPod would be via wholesale data agreements with one mobile operator in each iTunes market.
Apart from being able to take pictures and shoot movies with their wireless iPods, users could wirelessly publish their self-generated digital content on iTunes, the firm speculates.
"The mobile content side is interesting but you could also offer knock-out voice service with this approach -- Apple could offer free WiPod to WiPod calls, using a Skype-like software application. A lot of people in the mobile industry will be worried when this starts happening," Sheehy added.
Last month, iPod chipmaker PortalPlayer said it had teamed with wireless solutions provider CRS to deliver Wi-Fi and Bluetooth connectivity on its next-generation system-on-chip scheduled to make its debut in the second half of the year.
The San Jose, Calif.-based PortalPlayer, whose system-on-chip audio controllers have been a fixture in the iPod since its inception, currently supplies Apple with chips for all varieties of the digital music player with the exception of the low-end iPod shuffle.
This news has brought on industry speculation that Apple could launch its first wireless iPods in late 2006 or early 2007.
Comments
If Apple can get an average of $50 a month from just 1 million customers, not a lot, that would be $600 million a year. If they could sell higher end phones to those customers, that would be worth it as well. Those are conservative numbers. They could easily triple, or more, if the service is good.
The dates for these devices seems about right. Apple doesn't rush into these things. I would be surprised to see anything happen with wireless iPods, or phones before September, at the earliest.
I was dissappointed that Apple didn't buy Portalplayer before they went public. Almost all of their sales are to Apple anyway. Apple could have kept the designs within house. But, they don't like to aquire. I bought their stock as soon as they had their IPO. It went up fast, but when it started to drop, I dropped it.
1. Make a Keynote or PowerPoint presentation on Mac or PC.
2. Save to the wireless iPod.
3. Use the iPod as a wireless remote to do the presentation. No computer involved in the presentation. No cables involved. The wireless iPod sends the vido signal to the video projector on the ceiling via a wireless communication.
Such gadget will revolutionize the presentation world and be a new Trojan horse for Windows and Linux users. The potential halo effect is tremendous in the corporate, education and domestic market.
We just cannot wait!
- All products/services have substitutes and compliments. Compliments are the things which if you sold more of A, you'll sell more of B. Think printers and ink cartridges, iTMS songs and iPods, cell phones and air time. Like that.
- One of the theories in marketing/economics is that you want to "commoditize your compliments". "Give away" (at cost or free) the razors to sell more blades. "Give away" (at cost or free) the potatoes to sell more sour cream, chives and bacon bits. Like that.
- With iPod, Apple appears to have tried to "commoditize" the music. They have priced it too low for anyone to make a reasonable profit, but high enough that they cover their costs to run the store and deliver content. They have "commoditized" the music software (iTunes). All to sell more iPods. Some say Apple has reversed things...give away the blades to sell more razors. TiVO is trying to give away the blades (the hardware) to sell more "blades" (the subscription service). Mobile phone companies give away the "razors" (phones) to sell more "blades" (air time, minutes, etc.)
- Supposedly Apple is a hardware company.
I have (in the past) surmised that Apple would take a similar approach with either mobile phones or their "TiVO-killer" as they have with iPod...give away the "blades" to sell more razors...thus:
- Give away free subscriptions to the program/schedule content (unlike what TiVO does) to sell more TiVO-killer boxes. Catch? Only able to access their data feed with an Apple TiVO-killer box.
- Give away (at cost) the air time/minutes for talking to sell more iPhones.
Would Apple take this approach with "iPhone"? Hard to say. Communications bandwidth is in a glut, nearly zero-cost, commodity situation. Perhaps not "air time"...but backbone bandwidth is. There is so much dark fiber laced across this country it is laughable. Not sure that is true with mobile air time capacity.
But...this approach is just the sort of "Apple thing"...change the rules of the game. Turn things upside down. Make black white and white black.
It could be interesting.
Though I would be very surprised to see wireless iPods of any type in 2006!
Apple takes one step at a time, one foot in front of the other.
Apple is in the best position it has been in, in years. It's set-up to provide people with the best computers and OS in the world. It's working a broad range computers, and innovations. And it's in the process of building a serious line-up of products. Watch this space! To buy stock now is a very sensible move.
I think even through this transition year apple with outgross last years profits, but I think 2007 will be "the year of apple", regardless of wireless iPods.
I do want a wireless iPod though, that would be cool!
Originally posted by Chris Cuilla
Apple's iPhone play could be interesting.
- All products/services have substitutes and compliments. Compliments are the things which if you sold more of A, you'll sell more of B. Think printers and ink cartridges, iTMS songs and iPods, cell phones and air time. Like that.
- One of the theories in marketing/economics is that you want to "commoditize your compliments". "Give away" (at cost or free) the razors to sell more blades. "Give away" (at cost or free) the potatoes to sell more sour cream, chives and bacon bits. Like that.
- With iPod, Apple appears to have tried to "commoditize" the music. They have priced it too low for anyone to make a reasonable profit, but high enough that they cover their costs to run the store and deliver content. They have "commoditized" the music software (iTunes). All to sell more iPods. Some say Apple has reversed things...give away the blades to sell more razors. TiVO is trying to give away the blades (the hardware) to sell more "blades" (the subscription service). Mobile phone companies give away the "razors" (phones) to sell more "blades" (air time, minutes, etc.)
- Supposedly Apple is a hardware company.
I have (in the past) surmised that Apple would take a similar approach with either mobile phones or their "TiVO-killer" as they have with iPod...give away the "blades" to sell more razors...thus:
- Give away free subscriptions to the program/schedule content (unlike what TiVO does) to sell more TiVO-killer boxes. Catch? Only able to access their data feed with an Apple TiVO-killer box.
- Give away (at cost) the air time/minutes for talking to sell more iPhones.
Would Apple take this approach with "iPhone"? Hard to say. Communications bandwidth is in a glut, nearly zero-cost, commodity situation. Perhaps not "air time"...but backbone bandwidth is. There is so much dark fiber laced across this country it is laughable. Not sure that is true with mobile air time capacity.
But...this approach is just the sort of "Apple thing"...change the rules of the game. Turn things upside down. Make black white and white black.
It could be interesting.
I'm not sure they could do that with phone service. Bandwidth isn't the only cost here. Cell companies go the opposite way, subsidizing the phones to sell the service. They all give benefits such as giving free calls within network, etc.
But, they also charge for internet service, data transmitting, WiFi, etc. My daughter has Tv shows for another $10 a month as well.
I think Apple would have to charge for monthly service. They are not shy about that now. They charge for .Mac already. Perhaps this would be another service that could use that as well.
What would make my family switch would be a phone with OS X Lite. If the service was good, this would allow me to give up my Palm phone.
I could see developers of Palm and Windows Mobile software also moving over to this new mobile OS.
With open API's, Apple would pull in a lagre contingent. It would also be Apple's answer to the cell companies music services. I can't imagine Apple selling songs for more than the $.99 they do now, unlike the $2.50 to $3.50 the phone companies seem to want to do. Games could also move over.
In fact, I've spoken to Palm games companies who have told me that if Apple opened the iPod up to them, we would see a lot of games on it.
If i get it right it will let people to talk iPod to iPod, that could send Apple further beyond, but it will have to be very very well planed cause Cell bog dogs wont be happy about it and what about standerd calls receiving over an iPod ?
Could this generate new legislations ?
Very interesting but it needs a lot of work, hopefully Apple once again will come with a product/+sevice that can be awesome.
"Jimmin'y jillacurs Batman"
I'd gladly give my money to Apple instead of Cingular any day. And with smart consolidation I wouldn't have to pay TiVo or Netflix either, although I love those two services so parting with them would be hard.
http://www.avm.de/de/Presse/Informat..._03_09_04.php3
here is a bigger Picture:
http://www.avm.de/de/Presse/Pressefo...RITZ__Mini.jpg
For those who do not understand german:
Its a all-in one device about the size of the IPod Mini (it even has a "Dock COnnector at the bottom"
1. Its a WiFi-Phone: Once connected to a broadband-connection via Wifi you can make VoIP Calls to all over the world (an SIP-Account with a SIP-Provider required)
2. you can listen to your music/podcasts/web-radio stored on a hard drive/USB-Stick connected to the "Base Station" or directly from the web.
3. you can check your E-Mails/News/Messages without having to turn on your computer.
Its like a remote for your Music Collection
[ANDERS' EDIT]changed picture to link[/ANDERS' EDIT]
Originally posted by oberpongo
I just saw at CeBit a product that could be a very nice wireless Ipod:
http://www.avm.de/de/Presse/Informat..._03_09_04.php3
here is a bigger Picture:
http://www.avm.de/de/Presse/Pressefo...RITZ__Mini.jpg
For those who do not understand german:
Its a all-in one device about the size of the IPod Mini (it even has a "Dock COnnector at the bottom"
1. Its a WiFi-Phone: Once connected to a broadband-connection via Wifi you can make VoIP Calls to all over the world (an SIP-Account with a SIP-Provider required)
2. you can listen to your music/podcasts/web-radio stored on a hard drive/USB-Stick connected to the "Base Station" or directly from the web.
3. you can check your E-Mails/News/Messages without having to turn on your computer.
Its like a remote for your Music Collection
Don't you have a bigger picture?
Why not post the small picture and link to the large one?
Use the fekkin edit button!
Oh I get it, your an archaeologist,
and that product is 2000 years old!
- 120 of the 135 handset makers are losing money
- the lowest cost structure in the industry matters
These two things would seem to be dangerous signs.
If Apple makes their own phones, and doesn't cater to the "get it free with a contract" crowd, there is no reason why they shouldn't make money on them the way Palm is making it on the Treo.
People would pay more for an OS X phone, the same way they pay more for a Palm or Windows phone.
Originally posted by melgross
People would pay more for an OS X phone, the same way they pay more for a Palm or Windows phone.
Maybe. Not sure about that. I think OS X here is a red herring. People don't really care about OSes. They care about their product doing what they want it to do.
Originally posted by Chris Cuilla
Maybe. Not sure about that. I think OS X here is a red herring. People don't really care about OSes. They care about their product doing what they want it to do.
But...but...I want to run iMovie on my phone! WAAAAWAAAAAHHHHH
I read an interview with "The Steve" once where he said they like to control some piece of the technology of their products. Where/how would this happen with iPhone?
( just playing devil's advocate here...I'd love to see Apple do it...but looking realistically at all the issues )
Originally posted by Chris Cuilla
Maybe. Not sure about that. I think OS X here is a red herring. People don't really care about OSes. They care about their product doing what they want it to do.
It isn't really. I don't have a Palm phone just because it has the Palm OS. I have it because I first bought a Palm IIIC years ago at a Macworld here in New York.
I liked the programs available for it. I liked the way I could write with Graffiti. I liked the way I could store phone numbers and other contact information.
When I finally decided to get a cell, along with my family, after 9/11, I decided that it would have to be a color Palm phone, because I didn't want to carry two devices along that overlapped. a regular phone seemed very clumsy in the way information was input. and the lack of room for all the data way pretty useless as well.
The Palm phone eliminated all of those restrictions.
If Apple did come out with an OS X phone, or a MacPhone, I would switch. The idea of being able to do all that I do on the Palm would be an incentive alone. Palm might disappear as an OS, but it isn't likely for OS X?even a lite version, if it comes out.
It isn't just data, of course. It's games, and other programs as well.
If Apple does it right, there would be a good many people who would be interested.
Remember the recent surveys that have shown larger numbers of people than ever who buy an iPod are stating they will buy a Mac for their next computer. That number is up to 20%. In 2004 it was 13% of the people who bought about, how many, maybe 6 million iPods? Last year it was 20% of 32 million iPods. The first quarter of this year Apple sold 14 million iPods. These people are all candidates for an Apple OS phone, as are other people fed up with the Windows, Symbian, and yes, the Palm phones out there.
If Apple does do it better, they will come. The iPod proves that.