Study claims 'huge potential' for Apple iPod phone

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Comments

  • Reply 21 of 44
    Ask the question the right way, and you will get the answer you want most of the time.
  • Reply 22 of 44
    Quote:
    Originally Posted by Ireland View Post


    That's not taking into account the songs people buy as a result of them buying an iPod Phone, the halo-effect (the one that made me switch), the possibly of the service being provided by Apple. That 560Million could be worth a heck of a lot more in the long run.



    The real money is in phone accessories

    cases, chargers, headsets, holsters, etc...
  • Reply 23 of 44
    While I would most likely purchase an "iPhone" I am a bit nervous about tuning into T-Mobile or Cingular (now ATT wireless). Anyone in the NYC and northern suburbs area knows that these services suck in comparison to Verizon. The service needs to be as good as the phone itself.
  • Reply 24 of 44
    Quote:
    Originally Posted by anantksundaram View Post


    Such as...?



    I could make a few guesses...



    - Instant 2-way language translation

    - Speech-to-text/speech-to-fax/speech-to-email

    - Phone control of your home computer/home controls

    - Phone control of your rebranded iTV box (recording, etc.)

    - Bill pay thru phone



    ...Anyone else?
  • Reply 25 of 44
    feynmanfeynman Posts: 1,087member
    Quote:

    Study claims 'huge potential' for Apple iPod phone



    Meanwhile, a new study shows that brown bears have been shitting in the woods for as long as their existence.
  • Reply 26 of 44
    mcdavemcdave Posts: 1,927member
    Quote:
    Originally Posted by anantksundaram View Post






    The question is: Does the phone complement, or substitute for, the iPod. The effect of cannibalization on the "non-phone" iPod has to be considered.



    Depends on the price-point but I think the vastly increased market the device addresses outweighs any negative sales through cannibalisation. Soon, please, soon.
  • Reply 27 of 44
    Quote:
    Originally Posted by Feynman View Post


    Meanwhile, a new study shows that brown bears have been shitting in the woods for as long as their existence.



    Apparently recent research also suggests that the Pope may be a Catholic.....
  • Reply 28 of 44
    aegisdesignaegisdesign Posts: 2,914member
    Quote:
    Originally Posted by McDave View Post


    Depends on the price-point but I think the vastly increased market the device addresses outweighs any negative sales through cannibalisation. Soon, please, soon.



    Yup. I've no need for an iPod since it doesn't work as a phone, but not having a music playing phone would annoy me immensely since I'd then have a need for an iPod and I'd miss calls on my phone. Since I'm on call all the time, I can't ignore the phone (officially).



    If the luddites in America still think there's no market for camera phones or an 'iPod Phone' then they should hop on a plane (or perhaps a cruise liner if they don't like those new fangled flying machines) and visit Europe.



    Quote:
    Originally Posted by solipsism


    Is a camera phone a substitute for a digital camera? Not to most people.



    Actually it is. Especially now that most camera phones are coming in with 2-3 mega pixels and even some with 5 megapixels, zoom lenses and a flash. But aside from the specs, people don't like carrying around extra gear they don't have to.
  • Reply 29 of 44
    Quote:
    Originally Posted by gregmightdothat View Post


    That's an ad hominem. All that matters is that the sample size was large enough and fairly evenly distributed. It's not like the participants magically change their answers because Apple is funding the study.



    No it's not an ad hominem argument. That would be if the poster said "the study was bad because Solutions Research Group don't brush their teeth". The poster didn't say the study was bad because SRG was bad, he said he wanted to know who funded the study as it could influence the findings.



    Back to your point - Yes sample size is important, as is it being a representative sample. However,

    1) a survey can focus on one aspect accidentally or deliberately, ignoring other aspects.

    2) results can easily be portrayed in misleading ways.

    3) the questions themselves will lead the respondents to a certain degree. A good questionnaire should be written with that in mind.



    It's all basic Psych.
  • Reply 30 of 44
    Quote:
    Originally Posted by solipsism View Post


    40 million people x $400 per phone = $1.6B gross profit - 35% = 560M net profit





    40 million x $ 400 per phone = 16 billion
  • Reply 31 of 44
    Quote:
    Originally Posted by umisch View Post


    40 million x $ 400 per phone = 16 billion



    Actually, the arithmetic (and assumptions) in the original post made no sense to me. (How could he take the revenue of $400 and call it "gross profit;" if so, yes, it should indeed be $16 billion - unless he meant a 10% "gross profit" ($40 per phone); but even if it is $1.6 billion, that minus the "35% tax rate" is 1.6*0.65 = $1.04 billion in net profit, not $560 million).



  • Reply 32 of 44
    vinney57vinney57 Posts: 1,162member
    Quote:
    Originally Posted by anantksundaram View Post


    Actually, the arithmetic (and assumptions) in the original post made no sense to me. (How could he take the revenue of $400 and call it "gross profit;" if so, yes, it should indeed be $16 billion - unless he meant a 10% "gross profit" ($40 per phone); but even if it is $1.6 billion, that minus the "35% tax rate" is 1.6*0.65 = $1.04 billion in net profit, not $560 million).







    I think he is assuming a 'profit margin' of 35%. Apple's margin is consistently in the 25 - 28% area. With new launches, particularly into a new market, Apple traditionally will accept margins in the 15 - 20% area until the production smoothes out and components prices fall.
  • Reply 33 of 44
    ptrashptrash Posts: 296member
    Why are you all arguing aboujt the details? The relevant item for me is that 20% of Americans own an Appleproduct. What was their pre-Ipod marlet share?



    I'd buy an Apple phone, if I had the $$ and it had good functions (scheduler, contacts, etc)



    In light of the standard and poor's upgrade of Apple's buy rating to 5 stars (which I don't think is solely about the stock options scandal), and the buzz out here (and on their website), I think they have something big coming out. The release of this report only ups the expectation. Why wouold Apple release it only to disappoint us?



    Ps Does it matter if one product competes with another, if they're based on the same production points? It all looks the same on the accounting ledger, especially if the same supplier makes it.
  • Reply 34 of 44
    Quote:
    Originally Posted by solipsism View Post


    40 million people x $400 per phone = $1.6B gross profit - 35% = 560M net profit



    This post makes no sense. First of all, 40 million x $400 is $16B, not $1.6B. Second, "gross profit" refers to profit before taxes...and the corporate tax rate is nowhere near 65%. I believe the term you want is revenue. Third, you mean times 35%, not minus 35%. Fourth, you seem to be implying that Apple's margins are 35%. They are not that high, and furthermore, you are ignoring the continuing R&D costs, marketing costs, etc. A more reasonable figure might be 40 million x $400 = $16B revenue. Assume net profits are about 15% of the revenue increase; then you are looking at around $2.4B in profit (presumably spread over at least 8 quarters, so maybe as much as $300 million extra per quarter...which would actually be pretty huge given that last quarter's earnings were $540 million - but this assumes little cannibalization of iPod sales).
  • Reply 35 of 44
    More importantly, it'll be increasingly so that phones will eat into the iPod's market for music playing devices so it's better that Apple do that themselves than let Nokia or Sony do it.
  • Reply 36 of 44
    louzerlouzer Posts: 1,054member
    Quote:
    Originally Posted by Ptrash View Post


    Why are you all arguing aboujt the details? The relevant item for me is that 20% of Americans own an Appleproduct. What was their pre-Ipod marlet share?



    Considering Apple didn't make anything as cheap as an iPod, their pre-iPod share is kind of meaningless in comparison.



    As for the poll, to me its pretty stupid sounding. Let's look at the top:



    Quote:

    responded to a survey saying they thought an iPod phone would be a "great idea" for them personally.



    Wow. But what does that mean, it would be a 'great idea' for them personally? Does that mean "Hey, if I had that great idea, I could sell it, make a bundle, and live my life as a billionaire!"



    It sounds like a great idea, but its not about the idea that gets people to buy something, its about cost, implementation, performance, abilities, features, etc, etc, etc. If the phone only works on Cingular's networks, or Apple has over-designed some new interface so doing anything with it requires actual attention, or the thing keeps locking up on you, or doesn't get a good signal (hey, I sure hope Apple's Airport reception foibles over the last 5 years aren't recreated here), or it only works with Apple comptuers, or anything else you can think of, it'll be just another cell phone on the market.
  • Reply 37 of 44
    Quote:
    Originally Posted by Louzer View Post


    It sounds like a great idea, but its not about the idea that gets people to buy something, its about cost, implementation, performance, abilities, features, etc, etc, etc. If the phone only works on Cingular's networks, or Apple has over-designed some new interface so doing anything with it requires actual attention, or the thing keeps locking up on you, or doesn't get a good signal (hey, I sure hope Apple's Airport reception foibles over the last 5 years aren't recreated here), or it only works with Apple comptuers, or anything else you can think of, it'll be just another cell phone on the market.



    Depends on how the question was asked and with what background. If the survey described what an 'iPod Phone' did and they responded positively then 'sounds like a great idea' bodes well for the idea at least.



    Of course, the actual implementation details aren't known so the survey company is just guessing and so are you.
  • Reply 38 of 44
    Maybe if they were asked to compare features with their own cell phone, and if they'd be willing to pay up to $400 for this replacement phone. Most people take the free phone with a restrictive multi-year service plan.
  • Reply 39 of 44
    Quote:
    Originally Posted by aegisdesign View Post


    More importantly, it'll be increasingly so that phones will eat into the iPod's market for music playing devices so it's better that Apple do that themselves than let Nokia or Sony do it.



    Outstanding point.



    If so, I would agree that the "cannibalization" is not an opportunity cost for Apple; indeed, it is a necessary and smart part of its product/market strategy ("if I don't cannibalize, my competitors would do so anyway - so I'd better get in front of it"). It would be the same logic that led Apple to kill its own Mini for the Nano.
  • Reply 40 of 44
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by anantksundaram View Post


    Outstanding point.



    If so, I would agree that the "cannibalization" is not an opportunity cost for Apple; indeed, it is a necessary and smart part of its product/market strategy ("if I don't cannibalize, my competitors would do so anyway - so I'd better get in front of it"). It would be the same logic that led Apple to kill its own Mini for the Nano.



    This is the same strategy that paid off handsomely for HP in the printer segment.
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