Nowadays, it seems you can’t give detailed and intelligent answers anymore to the media. Instead, they lust after the pithy 15-second or 30-second sound bite, so it can be inserted between a wraparound report. And it’s not just any old statement, but something you can remember and repeat until the rest of time, even if it’s taken out of context.
So I’m not surprised that AT&T’s report that it activated some 146,000 iPhones during it first 30 hours on sale was dissed as extremely unfavorable news that sent Apple’s stock tumbling. Now I’m not going to say anything here about Apple’s financials, because that will be the topic of tomorrow’s commentary. I prefer to use facts rather than speculation or incomplete data.
But it doesn’t hurt to just look at what AT&T is really saying there, as part of a pretty favorable earnings report. Lest we forget, the iPhone first went on sale on a Friday evening, June 29th, and AT&T’s fiscal quarter ended at midnight on the very next day. All subsequent activations weren’t registered, nor the ones that were delayed due to the system being overwhelmed that weekend.
You should also look carefully at that word, “activations,” because it doesn’t necessarily reflect actual sales of the product. It means someone bought an iPhone, went to their home or office, launched iTunes, and successfully completed the process of provisioning the phone so it could function on AT&T’s network. Simple as that!
Despite this very significant exception to the prevailing wisdom, it didn’t stop Apple’s stock from taking a dump on the belief, yet to be confirmed mind you, that the iPhone wasn’t nearly as successful as people first expected. Compounding the misery is the report that stocks are plentiful, which means you can go and buy one and stand an excellent chance of getting the model you want.
To compound the confusion over AT&T’s singular announcement about the iPhone — no pun intended — Wall Street exists on a tightrope where even the vaguest sense of a favorable or unfavorable event is enough to cause stock prices to become increasingly volatile. Sometimes I wonder if it wouldn’t be a better idea to just go to the gambling tables in Las Vegas and squander my money on the slot machines. At least the outcome is certain; you know the house is going to win.
On Wall Street, only the stock brokers win, because they earn a commission regardless of the outcome.
In the end, though, is anyone to blame for the flap over real or imagined iPhone sales? It’s not as if Apple has been terribly forthcoming about how the product is doing, other than making it possible for you to check availability the night before. To be sure, availability has improved immensely. The last time I checked Apple’s online store, they were quoting a two to four-day delivery timeframe, which means you no longer have to wait long for your iPhone if you would rather have it delivered to your home or office rather than pick it up at a local retailer.
When you add up the cost of driving to a local shopping center and the time you waste searching for a parking lot, the feeling of instant gratification may feel a tad overrated.
Regardless of how successful the product, that should be pretty good news. But you can pretty much get any Apple product without much of a wait these days. This despite the fact that sales across-the-board appear to be continuing at a pretty good clip.
The reason for that is a factor for which Apple is almost universally praised in the tech industry, and that’s its brilliant inventory control. Except for a hot product’s initial introduction period, Apple has managed to figure out precisely how many units of a given model to build and where to ship them for maximum sales.
Alas, good things don’t always generate page views or sell newspapers and magazines. There are far too many vultures in the media who crave bad news, particularly about a company or person who has garnered the lion’s share of attention.
Even when Apple’s financials are almost uniformly positive, there will be far too many analysts and so-called journalists praying for failure. Even minor failures will do. Just watch what happens when Apple’s next quarterly report is released.
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