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  • So is Apple Toast, or Flying Higher than Ever?

    January 18th, 2013

    If you ever wanted to figure out what’s going on at Apple Inc., let me tell you that it may be almost impossible if you try to make sense of the contrary stories in the media these days. And that’s just the beginning.

    First there’s the claim of alleged reduced demand for the iPhone 5, based on unconfirmed reports that Apple sharply reduced orders for components last month. Yes, last month, though it reemerged as something new when the Wall Street Journal jumped on the story a few days ago. That fueled a severe drop in Apple’s stock price.

    Within a short time after the WSJ story appeared, a number of industry analysts, considered to be highly respected and knowledgeable about their fields, said it was all just noise. Demand for the iPhone 5 remains robust around the world, and that any drop in component orders was due to higher yields and normal seasonal trends. In other words, Apple would sell fewer iPhones in the March quarter than in the December quarter, so they order fewer parts. Nothing unusual about that.

    Rather than consider both sides of the story, which is what journalists are supposed to do, many media outlets played one version or the other. If the public, particularly those who invest in the stock market, are very confused, it’s no wonder.

    The negative spin suggests that Apple lost its way when Tim Cook, the operations guru, took over from Steve Jobs, the product guru. Without their co-founder and one-man band at the helm, Apple can no longer deliver cutting-edge products. Look at the Mapgate fiasco, for example. Never would have happened under the watch of Steve Jobs, but don’t forget .Mac and MobileMe, which didn’t quite set the online world afire. They also seem to believe that Apple must turn the tech industry on its head every year with a revolutionary product launch, for otherwise they will fail. This ignores the fact that the iPod arrived in 2001, and the iPhone didn’t appear until 2007. With the arrival of the iPad in 2010, maybe Apple hit a three-year cycle of revolution, which means something entirely original must arrive in 2013, or they are just doomed. But the year has just begun, and there’s no telling what Apple will introduce, other than the expected OS upgrades and hardware refreshes.

    No, a new Mac Pro won’t be a revolution, unless Apple can deliver something utterly unexpected in a computer workstation, and I don’t mean slimmer and lighter. And I don’t mean without a standard optical drive, which is something that will only upset the people who buy professional systems of that sort.

    There’s always TV, and the set top box, but the question remains what Apple might offer beyond better integration of your components, and a spiffier interface. Would that turn the TV world upside down, or would it require content deals that would forever alter the mold dominated by cable and satellite providers? Cutting the cord with iTunes and Netflix isn’t enough. It’s just a way to get a subset of the available TV fare ala carte. It doesn’t replace broadcast TV in any way, unless you get your TV from loads of sources, including a TV antenna for the few stations in your city. If you don’t have stations in your city, there’s always cable, I suppose. But isn’t that how that business started?

    Media pundits are also busy, as usual, telling Apple what products to ship. They got the iPad mini right, so to speak, although its arrival should have come as no surprise, despite Steve Jobs poo-poohing the idea. But when he talked about sandpapering your fingers to use one of those tiny tablets, he was talking about the 7-inch widescreen versions, typified by the Google Nexus 7 and the Amazon Kindle Fire HD. Apple got around that with 7.85 inches, and a standard aspect radio.

    Nowadays, it’s all about a cheaper iPhone, the better to serve people who want to buy an unlocked handset, particularly if a $400 minimum purchase price is outrageous. The rumors suggest unsubsidized prices of no higher than $199. Maybe that’s possible, if Apple cheapens the thing big time, but that’s not their way, though I wouldn’t dismiss the possibility of a $299 version. It would still be out of the price range of loads of potential customers, but enough of them would be willing to pay more for a genuine iPhone, rather than something that’s merely cheap.

    A reader suggested maybe adding a phone feature to an iPod, but consider the features and the screen size. Anything less than 3.5 inches may be a non-starter in terms of usability. Then you really would have to sandpaper your fingers, or market them towards small children. But that doesn’t make a whole lot of sense either. So you’re left with not an iPod, but another iPhone of some sort.

    But it’s real easy to tell a large multinational corporation what to do from behind your keyboard. There’s no accountability. You know they won’t listen to you, so you just keep repeating your spiel, hoping that enough people will read your stuff if it’s sufficiently inflammatory. Accurate or not, it’s all about the hit counts.

    And to those who may have profited from talking down Apple’s stock price with false information, that’s an offense for which there ought to be some accountability. But it’s not that there are going to be any consequences, except to those who lost money as a result.



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