gregg thurman

metrix said:

Don't give them a dime! They really think this will help their economic woes?

Funny you mention France's economic woes.  The French economy has been stagnant for a couple of decades.  France's new President, Macron, in only 6 months has begun dismantling long time French labor laws that make expanding employment so expensive as to be almost impossible.

Macron's actions come at a time when groups like ATTAC were lobbying for a 32 hour work week (presently 36 hour) and wanted more in the way of maternity leave, vacation time and even more stringent dismissal and layoff regulations (it takes about a year to dismiss an employee in France no matter the cause).  France leads the world in legislated labor benefits, and has an ongoing and chronic unemployment problem.

Tax revenue isn't France's economic problem, its unwieldy and regressive labor laws that are the problem.

I wish Macron (and France) the very best.

Apple's $390 million "investment" in Finisar is a stroke of brilliance.

Traditionally, new technologies rollout at very high prices, generating the cash flow needed to recapture R&D and facilities build out, then after those costs are recaptured prices drop precipitously.  The problem is achieving scale with those initial high prices, which can take up to 3-5 years with traditional new technology rollouts.

Apple wants that technology, but wants it now.  So instead of waiting for Finisar to finance scale up internally, Apple "grants" Finisar the funds necessary to greatly expand production capacity.  Apple can now adopt that new technology into its entire product line now, without waiting for the industry to generate price reducing scale.

Apple expenses the $390 million as a COGS over a 3-5 year period, but gets the production volume it requires today, not 3-5 years from now.  And, because of its $390 million "grant" Apple gets exclusive rights to Finisar's production capacity, denying competitors from using it in their own products for 3-5 years.

How far ahead of Android is Apple?  Three to five years.  But by then (5 years?) Apple will have shipped >1.250 billion VSCEL equipped devices.  Then even after Android gets access to VSCEL technology, with the above described upgrade rates, it will take years to match (if ever it does) Apple's installed base, especially when one considers Android ASPs, which will not support the production costs of VCSEL equipped devices.

Brilliant.  Simply brilliant.

wood1208 said:

Doesn't matter if phone has Gig+ speed chip inside. Boils down to Cellular network support of that speed and most importantly network bandwidth deployed everywhere to handle for every connection.

Full deployment of 5G LTE isn't scheduled to happen until 2020.  Shipping iPhones capable of utilizing the faster Gigabit protocol before then only makes sense if Apple doesn't want to offer a compelling reason to upgrade in September 2020.  I say September 2020 because full deployment of 5G probably won't occur until 2021 no matter what the telcos say today.  Telcos just don't move that fast.  Besides a 5G standard hasn't even been established yet.

I would be pleasantly surprised if telcos actually did fully deploy 5G in 2020.

seanismorris said:

spice-boy said:

Expect more manufacturers to have set backs as companies like Apple keep pushing for more advanced components to stay on top. 

I don’t think they expected demand for the X to be so elevated, and 8 muted.  

The manufacturers were probably positioned to volume produce the 8, and it was expensive to switch to the X.

This really isn’t that big a deal for Apple, besides delaying sales slightly as customers waited on the X.

#1."Apparent production issues are said to be the fault of the forward facing TrueDepth camera"
What production problems?  The iPhone X shipped on time and in quantities greater than that flake Kuo said they would.

#2. It is expensive to repurpose assembly lines, but Foxconn has not done that.  Foxconn simultaneously setup both iPhone 8 and iPhone X assembly lines to produce what Apple ordered a year ago.  Any adjustments to that configuration will be slight.

#3. As in prior launches Foxconn produced, shipped and invoiced for everything that occurred in the period.  This year Apple's #1 iPhone did not ship in the period referenced, ergo Foxconn had not invoiced Apple for those units.  That amount represents a significant amount of revenue and profit that will be reflected in November's statements.

This is a non-issue.  The market's reaction to it was led by uninformed retail investors selling, while institutional investors sat on their hands.  Tomorrow will be different as the institutions swoop in to pickup cheap shares.

unphocus said:

Why is it so high a tax rate for US company to bring home earnings? It’s like the US Government doesn’t want US multinational company to bring back any earnings to the US. High repatriation tax rate makes company looks for loopholes to pay less taxes. The US Congress should be saying “we see what’s happening; let’s reduce repatriation tax rate to make is easy for company to bring back earning from abroad so these companies can use the money to create more jobs” or something to that nature. It boggles my mind the stupidity of high repatriation tax rate. 

Ah, a logical response, not an emotional response.  I love it.  You are entirely correct, the US tax system was created when international sales were not as extensive as they are today.  It is a relic of pre WWII economies and does not reflect the world economic zone that we live in today.

Eliminating the philosophy of taxing production (income taxes in all of its various forms) in favor of consumption taxes (national sales tax/VAT) eliminates all issues of how much and to whom the taxes are owed.  If one country wishes a higher sales tax than another, then so be it.  Eliminating production taxes reduces the cost of production.  PRODUCTION TAXES ARE A COST OF DOING BUSINESS that is not created in a vacuum.  ALL BUSINESS COSTS are passed on to the consumer in the form of higher prices.

In the US elimination of production taxes will reduce the retail price of US made products by about 25% (yes its that high when you take into account all the various taxes paid that are based on profits).  A national sales tax of 25% brings the retail cost of a US made product, consumed in the US back up to its starting point.  Its a zero sum game.

A national consumption tax also eliminates PERSONAL income taxes and eliminates the need for special, tax deferred, restricted use, retirement savings accounts that penalize those that haven't the financial capability/flexibility to salt monies away for 40+ years for retirement.