iPhone Prompts Selldown of Phone Makers Shares [Archive]

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Nurhisham Hussein

01-12-2007, 04:00 AM

<div class='os_post_top_link'><a href='http://www.digitimes.com/news/a20070111PD203.html' target='_blank'>http://www.digitimes.com/news/a20070111PD203.html</a><br /><br /></div><i>"The share price of High Tech Computer (HTC) plunged by NT$41, or its 7% daily down-limit, to close at its lowest price in over a year (NT$549) on the Taiwan Stock Exchange (TSE) January 11, following heavy selling amid concerns that the unveiling overnight of Apple's iPhone would affect its business, especially in the US market."</i><br /><br />With the big bang intro of the iPhone at MacWorld, and Apple's proven track record with the iPod, it comes as little surprise that stock prices of <a href="http://news.yahoo.com/s/infoworld/20070110/tc_infoworld/85037">other phone manufacturers</a> are getting a hammering. Apart from the impact on HTC's stock price, Research in Motion (makers of the Blackberry) shares dropped 7.7%, Palm fell 5.7%, and shares of Motorola, Nokia, Ericsson, LG Electronics and Samsung were also hit. Apple of course benefitted, with its stock price rising 8.3% on the day of the announcement before falling back a little in the days since. There's still a lot of confusion in the financial markets as to what exactly would be the full impact of the iPhone - it's strictly high end, the new features are untested in the market and there's a feeling that it may cannibalise sales of iPods. If this is Jobs' swansong - he's in a heap of trouble over backdated options - he's certainly given Apple a heck of a going away present.

jlp

01-12-2007, 04:56 AM

...

there's a feeling that it may cannibalise sales of iPods.

So what? An ipod is an ipod!! It's as strange (*) a remark as saying the ipod video is cannibalizing the ipod nano sales - or vice versa. :roll:

If this is Jobs swansong - he's in a heap of trouble over backdated options - he's certainly given Apple a heck of a going away present.

What do you mean by that?

*At first I thought about another word starting with "st"... :twisted:

Gator5000e

01-12-2007, 05:02 AM

That's an expensive phone for no 3G. Got to believe something 3G won't be too far behind.

Nurhisham Hussein

01-12-2007, 05:46 AM

So what? An ipod is an ipod!! It's as strange (*) a remark as saying the ipod video is cannibalizing the ipod nano sales - or vice versa. :roll:

Simple - Apple's shares went up, which means that investors are valuing the company on the basis of higher expected profitability. The first reaction to the iPhone in financial markets was that Apple was breaking into a new market, so sales of the device would constitute a new revenue stream that would add on profits to already existing sales of the iPod. If the iPhone replaces iPods in sales, that could mean that profits remain at largely the same levels and the valuation of the company should be where it was before the announcement - which means all those investors who jumped in are going to lose money. The issue of whether the iPhone could cannibalise sales of the iPod is thus a valid point to raise, given Apple's stock price increase.

If this is Jobs swansong - he's in a heap of trouble over backdated options - he's certainly given Apple a heck of a going away present.

What do you mean by that?

link (http://news.yahoo.com/s/usatoday/20070109/tc_usatoday/stockoptionsbackdatingissuehauntsjobs)

link (http://au.news.yahoo.com/070108/20/11zwr.html)

alese

01-12-2007, 06:50 AM

It's really funny to read such stories. One phone (a nice one, but not really all that good), one expensive phone, available from one US GSM carrier in six months (or more) is going to hurt sales of large global companies like HTC, Smasung, Nokia...

Yes some people will wait for this instead of buying a phone, but I don't thing that there is going to be major decrease in sales because of that.

And another thing, PS3 $600 pricetag caused huge problems for Sony and iPhone with contract for $600 is a good deal?

ricksfiona

01-12-2007, 07:32 AM

It's just a blip. When the excitement wears off in a few weeks, all prices will be readjusted. It's a cool looking phone... But there are MANY others out there that just kick it's butt in terms of features..

But that iPhone is pretty cool looking :wink:

saru83

01-12-2007, 11:34 AM

It's a cool looking phone... But there are MANY others out there that just kick it's butt in terms of features..

i would say its not just about the features that one should judge a phone, there are stuff like: User friendly , support & much more.. & Apple knows really well how to built a very solid & User Friendly device, straight to the point & simple, basically they know what the consumer market wants, Heck we have been asking for stuff for YEARS now for the PPC plat form, but simply MS does not listen, they do what they want.. they r getting some serious competition now & i'm really glad about that.. i am seriously considering the iPhone when it comes out. if MS does not take some serious action they will lose a customer who gets over 4 PPC phones a year.. & i bet there area a lot like me.. :)

x51vuser

01-12-2007, 12:57 PM

But that iPhone is pretty cool looking :wink:

And that what counts.
'If you cannot make it working right make it looking good'
Bill Gates

zetsurin

01-12-2007, 02:04 PM

When the dust settles and everyone realises that you can't run user-created content on the thing, everything will go back to normal.

I was first very impressed by the iPhone. However after finding out it's big limitation (and the fact that you can only get it on a contract) I found myself outside the reality distortion field once again with the iPhone permanently removed from my shopping list.

JLittle1

01-12-2007, 02:08 PM

The market is over reacting to Apple's iPhone. No doubt well to do consumers will flock to the iPhone in similar fashion to the iPod Nano. Why not? Besides being a capable phone it trumps the current iPod Nano offerings. If BB and HTC have great plans to capture the consumer market they will take a hit. However if they keep to their knitting and focus on the business market there is lots of room for growth and innovation. That being said, until Microsoft figures out how to create a seamless user experience on a phone any device built on that OS will struggle for consumer acceptance.

dstrauss

01-12-2007, 03:44 PM

Can you say Razr?

Remember the intro of the worlds smallest, coolest flip phone? Remember the outrageous price ($499 with two year contract). Remember everyone having to have one, and getting them?

Now add real functionality; access to unlimited media content; most cool device since the millennium - now you can see what's about to happen. No, I don't own a share of Apple stock, nor have I ever owned an Apple computer. My kids go bonkers over iPods. and so do most other folks I know. They don't buy non-iPod mp3 players because others are cool, they just cost less and are more affordable. If they have the cash, they plunk it down on the iPod, and I'll bet they'll do the same for the iPhone.

They won't be able to keep them in stock. When Steve wakes up and throws HDSPA into the mix, I may even jump...

egoz

01-12-2007, 04:08 PM

alese

01-12-2007, 04:41 PM

Can you say Razr?

Remember the intro of the worlds smallest, coolest flip phone? Remember the outrageous price ($499 with two year contract). Remember everyone having to have one, and getting them?
...

I'm not from the states, so maybe it was different there. But I don't think Razr sold all that well when it had $500 pricetag.
Lately when it's dirt cheap (under $100 or even free) it's another story...

alese

01-12-2007, 04:45 PM

The the most marketable feature of the iPhone is its web-browsing experience: no more uniquely crafted pages, just zoom in and out and roll the page up and down as needed. They have, essentially, in one blow, doomed the mobile-to-web apartheid MS has embraced!

Somone in MS R&D shot that approach down, long ago... Why? cause it wouldn't be easy to do well. Gotta love the "can't do it easily so we won't do it" spirit growing in technology these days.

I'm not so sure it's all that great.
Sure it's full browser, capable of rendering everything perfectly, and sure zoom-in feature works, but how do you read a text on 1024 width page on 480 width screen?
I would guess by scrolling left and right, same as on any other mobile browser when it's in "desktop mode".
He didn't show "fit to screen" capability for a page in keynote, and unless he forgot about it, this is actually a big minus.

mesposito2

01-12-2007, 05:21 PM

[i]There's still a lot of confusion in the financial markets as to what exactly would be the full impact of the iPhone - it's strictly high end, the new features are untested in the market and there's a feeling that it may cannibalise sales of iPods. If this is Jobs swansong - he's in a heap of trouble over backdated options - he's certainly given Apple a heck of a going away present.

You can't be serious. The backdating thing is being taken care of, and no big CEO is going to jail or being fired, especially not one of the greatest CEO's Corporate America has ever known. (Apple, Next, Pixar, Disney)

There is a lot of defensive talk going on, and it's silly. The facts speak for themselves. This is a new product that is unique and sexy enough to bring lots of money to the table, whether it's repeat business or new business. It's all a big plus for Apple and for us as users.

A lot of folks here are missing the point on Apple's likelyhood to be successful with the iPhone. Forget about your features list. This is a first device in what will be a family of devices, just like the iPod. I doubt there is any item on any PDA/smartphone users key list of features that won't end up on some iPhone.

Also, Apple is selling a device that bundles into a family of products. This is very powerful. An existing iPod user that is going to upgrade can pick the phone. Nothing cannibalized there.

Apple announced that half of all of it's Mac sales were to New Apple customers, or switchers. When that new customer needs a new phone, and they see that the iPhone integrates with their iTunes library, they are more likely to buy an iPhone. More new money.

Apple is going for 1%, or 10 Million phones. That might hurt some high-end sales, but it doesn't put anyone out of business. Wallstreet always has knee-jerk reactions to things like this. (Sell now, ask questions later is pretty much their game, especially with technology, which they have no clue about anyway)

I'm using a Treo 700w now, but would love to get an iPhone, just for the pure pleasure of experiencing some new technology, and new thinking. (especially after owning a high-end phone that doesn't have enough RAM to run programs. :lol: )

If this spurs new creativity on our PDA's and smartphones, it's great. The iPhone will be a huge success. The Apple brand and the coolness of the device guarantees it.

Paragon

01-12-2007, 06:53 PM

i would say its not just about the features that one should judge a phone, there are stuff like: User friendly , support & much more.. & Apple knows really well how to built a very solid & User Friendly device, straight to the point & simple, basically they know what the consumer market wants, Heck we have been asking for stuff for YEARS now for the PPC plat form, but simply MS does not listen, they do what they want.. they r getting some serious competition now & i'm really glad about that.. i am seriously considering the iPhone when it comes out. if MS does not take some serious action they will lose a customer who gets over 4 PPC phones a year.. & i bet there area a lot like me.. :)

I totally agree with what you are saying. It is more than a phone. It IS about producing a solid device. It IS about offering good support. It IS about listening to, and understanding what the consumer wants, then producing it. If the iPhone comes out and has the ability to run 3rd party software, I too will add my name to the list of lost Windows Mobile customers.....and I've been a very solid customer and evangelist for the WM platform for several years.

Dave

T-Will

01-12-2007, 11:39 PM

I think when the ApplePhone is officially released, Jobs will announce "one more thing...we're dropping the price of the ApplePhone to $399 for the 4GB version, and $499 for the 8GB version. We're also cutting the prices on the entire iPod line."

Just a guess...

whydidnt

01-13-2007, 12:32 AM

You can't be serious. The backdating thing is being taken care of, and no big CEO is going to jail or being fired, especially not one of the greatest CEO's Corporate America has ever known. (Apple, Next, Pixar, Disney)

I think it's you who can't be serious. Apple's board "cleared" him of wrongdoing, but the SEC hasn't ruled yet. The SEC is looking for a BIG name that it can use to make an example out of on the issue of backdating options, and there aren't many bigger than Steve Jobs. Just ask Martha Stewart about what happens when the SEC decides they want to find a celebrity example to make a point.

Fact is neither of us knows what will happen, and he very well could be cleared, but that is certainly not guaranteed today.

There is a lot of defensive talk going on, and it's silly. The facts speak for themselves. This is a new product that is unique and sexy enough to bring lots of money to the table, whether it's repeat business or new business. It's all a big plus for Apple and for us as users.

I really don't see much defensive talk. I see people pointing out obvious concerns that MAY make the iPhone experience less than ideal. I do think the device will be very successful at launch, as it has a great wow factor. I also think the long term success will depend on how many of the questions brought up here regarding usability are addressed by the device. From Apple's perspective, it's a win even if it cannibalizes existing sales. As long as they maintain their normal margin on the sale of these they make more money since the iPhone is higher priced than any of the other iPod lineup.

Nurhisham Hussein

01-13-2007, 02:45 AM

You can't be serious. The backdating thing is being taken care of, and no big CEO is going to jail or being fired, especially not one of the greatest CEO's Corporate America has ever known. (Apple, Next, Pixar, Disney)

I think it's you who can't be serious. Apple's board "cleared" him of wrongdoing, but the SEC hasn't ruled yet. The SEC is looking for a BIG name that it can use to make an example out of on the issue of backdating options, and there aren't many bigger than Steve Jobs. Just ask Martha Stewart about what happens when the SEC decides they want to find a celebrity example to make a point.

The problem for Apple here is not that the options were backdated ("hey, everyone was doing it!"), but that the documents supporting the backdating were forged and that board approval for the options were supposedly given at a meeting that was never actually held. This shifts the complexion of the case from a civil (rules) infraction to a potentially criminal one. Apple managed to find a scapegoat (http://news.yahoo.com/s/nm/20070112/bs_nm/apple_options_dc), but how far does anybody believe that she did it on her own?

DaleReeck

01-13-2007, 07:36 AM

Don't assume that full page web browsing is the most amazing experience. I have a Sony UX280P. It has a 4.5 inch screen and runs full Internet Explorer. However, the screen fonts are small to the point of being uncomfortable. I have 20/20 and it's difficult to read some pages even for me. There are ways to increase font size and DPI. Plus zooming utils built into the device. But that doesn't solve all the problems. I don't know what iPhoine's capabilities will be in that regard. But when you mess with the sizes, then the pages start to lose their original design. The point is, there is only so much that a small screen can handle in information. If MS didn't implement full browsers, that's probably becasue a 3 or 4 inch screen on a PDA just can't handle full apps sometimes.

jlp

01-13-2007, 07:37 AM

...
Sure it's full browser, capable of rendering everything perfectly, and sure zoom-in feature works, but how do you read a text on 1024 width page on 480 width screen?
I would guess by scrolling left and right, same as on any other mobile browser when it's in "desktop mode".
He didn't show "fit to screen" capability for a page in keynote, and unless he forgot about it, this is actually a big minus.

Look at this page (http://www.engadget.com/2007/01/09/live-from-macworld-2007-steve-jobs-keynote/) that has a full coverage of the keynote with pix.

Halfway down the page you'll see a "fit to screen" shot.

alese

01-13-2007, 10:35 AM

Jason Dunn

01-16-2007, 07:20 PM

Like so many Apple announcements, one has to wait and see what happens. There are certainly some aspects of the iPhone that make me jealous that Windows Mobile can't match it (currently), but I'm also not convinced that the $499 and $599 price point will work with consumers...that's business-class pricing for a device without a keyboard, so most heavy-email users won't touch it. It will be VERY interesting to see how this plays out.

Paragon

01-16-2007, 07:31 PM

I'm also not convinced that the $499 and $599 price point will work with consumers...that's business-class pricing for a device without a keyboard, so most heavy-email users won't touch it. It will be VERY interesting to see how this plays out.

I'm not so sure that price point is such a big factor. This is simply the first device announced. There will surely be other models to come, just like the iPod with it's Nanos, and Shuffles. When it comes to spending money people will put cool and appeal ahead of functionality. The ipod is a great example of that. It sure isn't the best music player on the market, neither is it the cheapest, yet it has had HUGE success.

Dave

Jason Dunn

01-16-2007, 07:39 PM

I'm not so sure that price point is such a big factor.

Pricing in phones is a HUGE factor. Most people get free/cheap phones when they renew their contract. When the RAZR came out, it was popular, but it wasn't EVERYWHERE until it became much less expensive. If Apple's goal is 10 million phones sold, then perhaps that's doable - maybe there are 10 million people willing to pay a high price for an iPhone.

There was an early rumour about the iPhone having two batteries, but they didn't mention that in the keynote - meaning it probably has the same flaw that all converged device have: if you listen to music or watch videos, it will kill your battery and then you have no phone. That's a big problem with devices like this (including Pocket PCs), so it will be interesting to see how people find using the iPhone in real day to day life.

Remember that most people still do not want converged devices: the bulk of the population was their phone to be a phone. In that sense, this is not a mainstream device. But Apple has never been about going mainstream with their computers, so perhaps they're ok with the same niche market for this phone.

What I find interesting is that by announcing but not shipping for six months, Microsoft, Blackberry, Motorola, Nokia...they all have time to come up with a competing product and at the very least announce it before the iPhone ships, even if it's not ready to go yet. Apple is really out of their element here in having to announce a product so far in advance of it shipping.

There's also some serious smoke-and-mirrors going on here with them saying "It's OS X!". That thing is running on a Samsung ARM processor I believe, so it's NOT OS X in the traditional sense.

Paragon

01-16-2007, 08:12 PM

I'm not so sure that price point is such a big factor.

Pricing in phones is a HUGE factor.

Sorry Jason, I don't think I made my point clear enough. What I meant was that if this device is seen as being pricey, it is the high end and will surely have less expensive models.

As for everything else being hashed around about this device, it is all speculation at this point. There is far too much gray area in all the known details so far.

dave