Apple plans cheaper, Nano-based phone: JP Morgan
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Apple Inc. plans to launch a cheaper version of the iPhone in the fourth quarter that could be based on the ultra-slim iPod Nano music player, according to a JP Morgan report.
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An extensive teardown analysis by research firm iSuppli released this morning on Apple's second generation iPod nano MP3 player announced last week, reveals the company is probably paying 20% less to build this new model than for the previous nano generation.
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(InfoWorld) - As IT investors brace for a wave of financial reports next week, mobile device makers are attracting attention as Asia becomes an increasingly important battleground for handset sales. For example, Motorola preannounced part of its quarterly report, due July 19, on Wednesday, saying thatÂ second quarter sales would be $8.6 billion to $8.7 billion, instead of $9.4 billion as previously forecast. The company expects a drop in handset sales in Asia, where vendors are vying to get the lion's share of the market in growing national economies, as North American and Europe become saturated with mobile phones. Despite the revised forecast, Motorola enjoyed a spike in the price of its shares caused by rumors that CEO Ed Zander might resign. Motorola shares jumped Wednesday by $0.33 Wednesday to close at $17.95, and rose again Thursday to close at $18.08. Zander attracted criticism from heavyweight investor Carl Icahn earlier this year and now has come under attack from well-known activist shareholder Eric Jackson. Zander's departure would indicate that a serious restructuring was under way at the company, which has been outflanked on several fronts in the handsets wars by rivals like Apple. Meanwhile, investors saw Motorola's quarterly weakness as Nokia's gain. Brokerage Oppenheimer & Co. reiterated a "buy" rating on Nokia after Motorola's announcement. Nokia shares rose $1.08 Thursday to close at $29.95. The mobile phone market has come under increasing scrutiny lately in the wake of the June 29 launch of Apple's iPhone in the U.S. Apple is now reported to be in talks with carriers to launch the device in Europe, Finland-based Nokia's home market. A report from a JP Morgan Chase analyst Tuesday thatÂ Apple will also launch a cheaper version of the iPhoneÂ in the fourth quarter drove up Apple shares. JP Morgan analyst Kevin Chang said the new model could sell for less than $300, basing his report on Apple patent filings and component supplier sources. A cheaper iPhone would put it within reach of younger customers. Apple shares rose by $1.68 Thursday to close at $134.07. Technology companies for the most part are riding high on general confidence in corporate earnings. The technology-heavy Nasdaq has hit several six-and-a-half year highs over the last 10 days. General economic conditions have helped. For example, the Dow Jones Industrial Average reached a record Thursday on positive news from retail sales data and continued mergers and acquisitions announcements. But IT vendors themselves are coming off a string of quarters that have generally been good for earnings overall. The torrid pace of M&A in IT also continues unabated: Just this week, for example, Google beefed up security offerings with itsÂ planned $625 million buy of Postini. Next week will provide key information for forecasts for the rest of the year as a string of IT bellwether reports quarterly sales and guidance for the rest of the year. Among those due to report: IBM, Google, Yahoo, Motorola, Microsoft, Intel, AMD, and SAP.
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(InfoWorld) - When Apple launches the iPhone on Friday, it is set to get a jump on its competitors and spark a flurry of new phone designs, regardless of how well the device actually sells. By introducing a combined smartphone, mobile e-mail platform, and MP3 music player with a touchscreen interface, Apple has sent other hardware vendors running back to their drawing boards. And the company has enjoyed positive press coverage since CEO Steve Jobs announced the iPhone in January, analysts said. Apple is feeding the fire with strong advertising in its retail stores. On Monday, staffers at the Apple store in the Cambridgeside Galleria mall in Cambridge, Massachusetts, wore black T-shirts with the logo "the wait is almost over," printed above an image of a calendar page for Friday, June 29. iPhone anticipation has already created a "halo effect" of increased sales for Apple's notebook and desktop PCs, an impact that is likely to increase after the launch, according to a report from ChangeWave Research. Apple posted a strong profit for the last period despite struggling with a U.S. federal investigation into executives backdating their stock options. In April,Â Apple beat Wall Street expectations by posting a profit of $770 million for the second quarter, an 88 percent rise from that period last year. Because the company has already garnered media attention and a sales boost from iPhone demand, Apple will suffer little damage even if the device is a flop in retail sales, one analyst said. "No way Apple will seriously impact Nokia or Motorola or Samsung, who combined sell over a billion phones a year. But if Apple manages to sell several million, then that is probably pretty good for their overall business," said analyst Jack Gold, founder of the research firm J. Gold Associates. "I think the potential gold mine is in the services, not the phone hardware." The iPhone will bring new subscribers to Apple's iTunes online music store, and Apple could make more money if it decides to launch future wireless mobile products like navigation, location-based services, VoIP telephony, and video streaming, Gold said. In the meantime, Apple has already given a headache to competitors scurrying to catch up, such as Motorola, Samsung, and LG Electronics. Even vendors with comparable products -- like Nokia's N Series and High Tech Computer's HTC Touch phones -- lack Apple's cachet and will have trouble competing on store shelves, he said. In fact, some experts are warning that iPhone sales could fall short of Apple's high expectations. Their criticism includes potential user confusion about Apple's "virtual keyboard," a battery that may fade too fast and is not user-replaceable, andÂ resistance by some corporate IT departmentsÂ to the added expense and security risk of supporting mobile e-mail networks in addition to the servers they use to support Research in Motion's BlackBerry device. Those drawbacks could limit the iPhone's success in the business market, said Shaw Wu, an analyst with American Technology Research. Still, the iPhone will be popular with those who tend to use smartphones more by scrolling through menus than typing long messages and who have made Apple's iPod music player a huge hit despite similar concerns about its battery, Wu said. Likewise, consumers will likely shrug off corporate security concerns and use mobile e-mail systems from GoogleÂ and Yahoo. In the long run, Apple will use the iPhone to beat its competitors in creating an end-to-end channel for digital media, spanning from Mac PCs to the mobile iPod music player, iTunes online store, and Apple TV set-top box for sharing Internet and television video content. The only thing Apple could do to spread that net even wider would be to offer iPhone models at less than the current $499 for a 4GB version and $599 for the 8GB, Wu said.
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Apple Inc.  and AT&T Inc.   said on Tuesday they will offer three price plans,  starting at $59.99 per month, for the widely anticipated iPhone  that is set to go on sale this week.
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(InfoWorld) - Google and Intel have already expressed interest in the forthcoming 700MHz spectrum auction. Now, speculators say Apple may throw its hat into the ring. TheÂ auctionÂ is creating a bit of a frenzy because the winner will obtain some of the last available prime spectrum, ideal for delivering broadband wireless Internet access. The U.S. Federal Communications Commission (FCC) expects to auction it off next year. While Google has said that it may bid in the auction, Apple's participation is pure speculation, and analysts appear split on whether it makes sense for theÂ iPhoneÂ maker to become a network operator. Apple's entry into the carrier business, while interesting to speculate, is difficult to imagine since the company already has a "sweetheart deal" with AT&T, said Michael Gartenberg, an analyst with Jupiter Research. In an unusual arrangement for the mobile industry, Apple is thought to receive a portion of the monthly service revenue that AT&T earns from iPhone customers. AT&T is the iPhone's exclusive carrier. Gartner analyst Van Baker finds it "highly unlikely" that Apple would be interested in buying the spectrum. "It's a very different business than they're in, and it's not something they have a whole lot of expertise in," he noted. Apple could decide to partner with another company that has more experience in the mobile operator business, which could make more sense, Baker said. Still, the arrangement between Apple and AT&T looks beneficial to both companies, so there probably isn't a significant incentive for Apple to want to change that setup, especially because the operator business comes with "lousy margins," he said. However, Apple might have at least one good reason for wanting to operate a network, said Avi Greengart, an analyst with Current Analysis. "They do like to control the end-to-end experience," he said. While becoming a mobile operator would be a "tremendous stretch" for Apple, it wouldn't surprise Greengart if Apple was considering it. An Apple network would likely be very tightly integrated with Apple products and come with very simple pricing, he said. Such a strategy could have a ripple effect across the industry. Operators tend to watch what competitors are doing and make adjustments to their own strategies accordingly, he said. Greengart and the others cautioned that they hadn't heard directly from the company or other sources that Apple was considering the auction. "But they're pretty good about being tight-lipped," Greengart said. Apple is known for being very secretive, with big announcements leaking out only days in advance, if ever. BusinessWeek first reported on the rumor that Apple might be interested in the spectrum auction.
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An analyst has told clients to expect Apple and Motorola to demonstrate a new mobile phone with a built in iTunes software client at Macworld Expo San Francisco.
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Remember a couple of weeks ago when Steve Jobs took the stage and announced a $200 cheaper iPhone. That was pretty bad. And an iPhone that's just an iPod. Who needs that! The new Nano sure is cute, but cute insn't enough. I have a 1.5 year old 60GB video iPod that still works (sorry Steve) and I never use the video, so the $300 I have burning a hole in my pocket for my monthly Apple impulse buy (above and beyond the new Mini I bought last week) is going to (drum roll please) Nokia!  Yup, my next iPod/iPhone-alike thingy isn't even from Apple and it runs Linux, and comes highly recommended by geeks everywhere. I just put in the order on Amazon, I'll let you know how cool it is in a few days.  PS: This is my way of thanking Ben Bernanke for the huge windfall I got in the stock market yesterday and today. I think the 1/2 percent drop in interest rates is supposed to make us go out and buy stuff to stimulate the economy. Just doing my part Uncle Ben!
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Apple Inc's  hefty iPhone  price cut pits it in direct competition with handsets from  Motorola Inc  and Palm Inc , which are  struggling to convince Wall Street they can turn around their  aging brands.
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A financial analyst says Apple will follow its iPhone with a cheaper version based on the iPod Nano.
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Apple may release an iPhone with 3G technology by midyear, financial analyst says.
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An analyst for JPMorgan Chase made headlines recently by saying Apple would soon release an iPhone resembling its nano media player.  One of his colleagues, however, disagrees.
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A new iPod cell phone could bolster revenues.
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Apple Inc. said on Tuesday its hotly anticipated iPhone could cost as much as $3,000 with a required two-year service contract, and a handful of eager buyers started lining up to spend their money.
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Apple Computer Inc.  is widely expected to unveil cheaper portable music players and Macintosh computers next week at its annual trade show as it seeks to change from a niche technology player to the mainstream champion of the "digital life."
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(InfoWorld) - The number of iPhones manufactured by Apple may not be enough to meet customer demand when the smart phone goes on sale later Friday, CEO Steve Jobs said in an interview published the same day. "We had to make our best guess as to what the demand was going to be and what supply we were going to put in place many, many months ago. We built factories to build these things and everything. We've taken our best guess but it wouldn't surprise me at all if it ain't enough," Jobs told the Wall Street Journal in an interview. The iPhone, which combines the functions of an iPod with a smart phone, goes on sale in the U.S. at 6 p.m. and is one of the most anticipated gadgets in recent years. Two models will offered, the 4GB model costs $499 and the 8GB model is priced at $599. Users also have toÂ sign a two-year contractÂ with carrier AT&T. The cost of those plans range from $59.99 per month to $99.99 per month. Some prospective buyers have beenÂ camping outside storesÂ in hope of being among the first to own one of the new smart phones. A surge in demand for the iPhones could mean the devices are hard to come by at first, depending on the number that Apple and AT&T have in stock. A shortage of iPhones would not be unusual. Vendors often have a limited number of units to sell when a new product hits the market. In the case of products where demand is particularly high, such as for new game consoles, limited product availability -- whether intentional or not -- andÂ long lines outside storesÂ help build buzz and generate media coverage. Jobs also downplayed concerns over the iPhone's dependence on AT&T's EDGE network, which is slower than 3G (third-generation) networks. "You know every (AT&T) Blackberry gets its mail over EDGE. It turns out EDGE is great for mail, and it works well for maps and a whole bunch of other stuff. Where you wish you had faster speed isâ¦on a Web browser. It's good enough, but you wish it was a little faster. That's where sandwiching EDGE with Wi-Fi really makes sense because Wi-Fi is much faster than any 3G network," Jobs told the Wall Street Journal. He said the iPhone had been designed to switch to Wi-Fi when such networks are detected. Â
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Japan's Softbank Corp said on Wednesday   it has begun offering an Apple Computer Inc. iPod nano packaged   with one of its own mobile phones.