radarthekat

foljs said:

We're so used to it now that the word iPad no longer conjures up Maxi-Pad-like connotations but it was a fair criticism and a good point.

Yeah, if you're 13 years old, and laugh at anything that can construed as a reference to bodily functions.

As if the word pad wasn't in common use for all kinds of other things without anyone laughing (drawing pad, launchpad, mousepad, and so on).

The connection also don't even register to 95% of the Earth's population, who aren't Americans, and don't call a product "maxi-pad".

Exactly.  Here in the Philippines I get strange looks if I ask for extra napkins at a restaurant.   That’s the word they use for feminine pads.  Tissue is the word here.

It’s too bad there are absolutists when it comes to views on Apple’s stance on privacy and other issues that are often treated differently in some countries.  Apple doesn’t take the easy road, as Android apparently has on this demand by India.  Absolutists won’t acknowledge that Apple will engage in these issues where others simply fold.  And that’s exactly what Tim Cook has said all along.  

Not a direct quote - I’m too lazy tonight to go find it - but he’s essentially said that ‘we don’t always agree with government policies in the countries in which we do business, but we feel it’s more productive to engage rather than take our ball and go home.’

To engage doesn’t mean to take a billigerent and uncompromising stance and fight until you win or until you can’t win and then take your ball and go home.  To engage means to take a principled stance and argue for it in an attempt to persuade, and if you lose the fight you remain engaged so that you might have some influence down the road or on the next issue.  You become seen as a principled voice of reason and an engaged partner with your adversaries.  If you stick with it long enough, they might one day turn to you and ask, ‘what’s your advice on this upcoming proposed policy?’  A soft touch often has greater results than a hammer. 

“The investment was a stock purchase, and didn't directly put money into the hands of Apple.”

I don’t think this makes sense.  Are you saying that Jobs made a big deal out of it and teleconferenced Bill Gates onto the big screen because Microsoft went into the public market and bought $150 million of Apple shares?  Tim Cook didn’t bring Warren Buffett on stage when Buffett made his open-market Apple share purchases.  Or Carl Icahn when he made his purchases. Seems to me Apple would have issued shares to Microsoft, and that means Apple would most definitely have received the $150 million to add to its balance sheet and to use in its operations.  

To those who suggest buybacks have no effect, I’ll add that an often missed benefit of share buybacks is to get the cash off the balance sheet.  With less static cash sitting around each dollar invested in the company means a higher percentage of that dollar invested in ongoing and productive operations (what the P/E and other valuation metrics apply to) with a smaller percentage of that invested dollar merely buying part of a relatively static cash hoard.  Who wants to pay a dollar to get only 70 cents worth of a business and the other 30 cents getting you... 30 cents sitting in Tbills?  So the buybacks, by clearing out excess cash, make the company (and its shares) more attractive to new investors, not just those already holding shares.

Let me reiterate...  P/E and other valuations measures apply to the ongoing operating business, not to the cash hoard.  If there’s a ton of cash on the books, I nvestor’s know that their invested dollars are not working at full capacity.  They will see that they are paying $1 to get, say, 70 cents of operating business and 30 cents of cash, effectively meaning only 70% of their invested capital is working for them.  Nobody wants their investing capital diluted in this way.  The result is such a company is given a lower P/E and lower values for other metrics that measure against business performance.  And that becomes a drag on share price increases.  A company that carries a 30 P/E that increases its earnings $1/share gets $30 added to its stock price.  Another company that carries a 15 P/E that also raises its earnings per share by $1 gets a $15 increase in its share price.  So a drag on the market’s valuation of the business directly effects share price increases as the business grows.  Having excess cash depresses valuation measures due to the dilution it creates to investors capital.  We can see the result in Apple’s aggressive share buybacks.  The company’s P/E, as one very visible valuation measure, has increased from 12x a few years ago to over 19x today.  And that’s not from explosive growth in profits (the profits are not growing like they were in the first several years of iPhone, at 70%).  The recent P/E expansion is partly related to a more efficient allocation of each invested dollar that folks like you and me and institutional investors use to buy shares.  There are other reasons for valuation metric increases, and one is the growth of services, which tend to net closer to 7x revenue valuations (see Netflix’s P/S number) versus 4x revenue valuations that are typical of product companies.  But the buybacks removing excess cash is also part of valuation metric expansion, no doubt.   And that goes hand in hand with the increase in profits per share that comes from reducing the share count (the most commonly cited and most easily understood catalyst). 

What’s likely happening here is indirect infringement. The maker of the solder, if it does indeed infringe someone’s patent, is responsible.  That’s common sense.  But the company using the infringing product can be sued for indirect infringement, because they may have chosen that product for use even aware it infringes a patent.  So the patent owner has a choice, go after the manufacturer of the product (the solder manufacturer in this case) for direct infringement, or go where the money is; the huge global company using that product in the manufacture of expensive high-margin products, accusing it of indirect infringement.  Easy to see why they are suing Apple.

It’s up to Apple to have in place an indemnification agreement with the solder manufacturer, and I would think as a matter of course Apple would have such an agreement in place with every supplier it purchases from, and perhaps even requires each supplier to be bonded.  So Apple will have recourse to sue the solder manufacturer in the event Apple bears costs in defense of itself in any suit brought against it.  Getting blood from that stone, of course, is exactly the reason the patent holder instead chooses to go the indirect infringement route against Apple.  Ain’t life grand?