AMITIAE - Wednesday 30 December 2015
Cassandra: Mid-week Review - At Year-end Apple's Glass is Half empty. Or Half Full
By Graham K. Rogers
In using the word, "Analyst" this widens the definition somewhat, as a good analyst would look at all sides of a problem and not simply cherry-pick the useful parts that will help make headlines. There are a number of such names that appear over and over, among them Trip Chowdhry at Global Equities, Apple Contrarian Michael Blair who writes on Seeking Alpha, and Alex Cho.
Chowdhry was famous for one or two Apple-doom comments but excelled himself with the warning that if the Watch did not appear soon, then Apple would be dead. The ridicule that followed has kept him somewhat quieter these days, but there are now the occasional positive Apple grunts. Give Blair a set of figures and he will prove that Apple (or the product he is writing about) will lose to the Samsung, Microsoft, Blackberry equivalent. Apart from reading the text open-mouthed with the technological wrongness of some of what he writes, I find the Comments section rewarding as I am obviously not alone in finding his analysis wanting: and some of those commenting are industry heavyweights.
In linking to Philip's report, John Gruber on Daring Fireball also mentioned Per Lindberg who in a 2010 report from David Milstead on The Globe and Mail, was the only analyst out of 40 who put a "sell" on Apple stock, since which time Gruber says it has risen by about 8 times.
Alex Cho does not often have much that is positive to say about Apple and I am always wary when I see his by-line. Despite what Tim Cook said a couple of weeks ago about taxes on repatriated monies - the profits that Apple has earned via its subsidiaries in countries outside the USA - that it would cost 40% (I thought it was 30%) and would be irresponsible for him to do this, Alex Cho thinks otherwise.
Writing on Seeking Alpha earlier this week, he does admit he has been more bearish on Apple (understatement?) but thinks the cash would do better working for Apple at home and the company should take the hit. He himself writes that "Since 60%+ of Apple's cash generation comes from overseas," but he is erroneous in using the verb "comes from". The cash is generated there, and there it should stay.
I was pleased to see that later the same day, Bill Maurer, also on Seeking Alpha, was opposed to Cho's thesis with two basic, but strong reasons: The scenario involved would not work in today's market; and it would leave Apple in a low cash, high debt state. The article examined some of Cho's financial comments and found them to be wanting . He does agree that some of the money could be repatriated, but that "depleting the foreign cash pile limits the company's financial flexibility" would send the wrong message to investors. One wonders why other analysts would make such suggestions. . .
As an aside, Apple has agreed with the Italian authorities to pay the €318million ($348m) it owes for taxes there when it allegedly failed to declare earnings between 2008 and 2013 (Rich Edmonds, iMore). And I am sure that not one cent of that figure came from funds in the USA.
No matter, it has been reported widely in the last couple of days that DigiTimes says iPhone shipments are to fall, therefore, Apple is failing and the sky is falling. Tyler Durden on ZeroHedge, repeats the comment that 4th quarter shipments are expected to fall "to 72-75 million units, compared to 76-78 million units predicted earlier."
Note that; and then ask the question, Who predicted those figures? The probability is that it was the analysts as Apple does not release guesstimates of its product sales.
Add to that, an item on ZDNet (not noted for being pro-Apple), by Adrian Kingsley-Hughes, who writes that "there was no shortage of new iPhones and iPads wrapped up under trees this year." Citing Yahoo's Flurry analytics he gives a figure of 49.1% of new devices being iPhones and iPads. Then he adds an interesting comment: Remember though that the overall market is expanding.
This means that the pie is bigger and more devices than ever were sold. And Apple had 49% of "more than ever". Apple is clearly doomed under the laws of what goes up, must come down. Also reporting similar was Sarah Perez on TechCrunch.
iPhone 6s Plus - with A9 chip, Haptic motor, Touch sensors, 12MP camera, Aluminium 7000 body, et al
It is also interesting to read in an item by Dan Thorp-Lancaster on iMore that Apple is looking to source OLED displays from both LG and Samsung for future iPhones (though probably not the iPhone 7).
And one more thing: while everyone is looking in the directions of USA, Europe, China, with side-glances towards India, Dennis Sellers on Apple World Today, reports that in the Middle East and Africa iPhone sales grew 133% in the third quarter of 2015 compared to the same period in 2015. The figures of total units are still low compared to those of other brands, particularly Samsung, but with technology limits of some phones, Apple "sells around ten percent of the premium, LTE smartphones".
They have also desperately wanted a phone for a long time. With The Elop-Ballmer disaster of Nokia behind them, MacNN reports that there is a development coming of a Surface-style phone, according to Chris Capossela, chief marketing officer. They are aware that being a ho-hum Surface phone is not just enough and there must be something about the phone to grab people. I saw that before somewhere. . . .
There have been more than 300 bugs reported in Flash this year Abhimanyu Ghoshal writes on The Next Web When I hit the link to that article, Little Snitch asked for permission to send data to something called Social Honey. I hit Deny, then after the page loaded, checked: it is a service used by publishers to find out about readership. My data. Little Snitch will sometimes report half a dozen outgoing connections from some web pages, all of which take up my bandwidth. And yours.
With some perseverance, the information was tracked down and recreated and The Crossing (an account of an accident that killed some 20 high school children) has now ben recreated. As the authors want to retain the original style, not only did they receive permission to use the font specific to the now defunct Rocky Mountain News, but the videos use Flash.
There are also thousands of laws still on the books in the UK, such as the Town Police Clauses Act of 1824 (along with the Vagrancy Act 1824): things like stringing a line across a street, dropping a flowerpot from a windowsill, setting fire to your chimney (still used often) and any one of over 100 offences are still available for use, including laws for prostitution and being a rogue & vagabond (brought in because of begging soldiers after the Napoleonic Wars).
In the article, Moxie Marlinspike cites Justice Breyer: the laws "make it difficult for anyone to know, in advance, just when a particular set of statements might later appear (to a prosecutor) to be relevant to some such investigation."
So with nothing to fear, The Independent asked for Home Secretary, Theresa May's browsing history and Cory Doctorow reports on BoingBoing that this was rejected for being "Vexatious". I would prefer the word, hypocritical as this sort of data is exactly what May plans will be kept on anyone who uses the Internet in the UK. Mike Masnick on TechDirt also reported on this, adding that "Chris Gilmour sent in a FOIA request for May's metadata" and both he and the Independent were fobbed off with the "vexatious" remark.
Photo taken on 19 May 2015, with Nikon D800 camera, at ISO 640, aperture of 7.1, at a speed of 1/250 sec (manual settings), with a lens at focal length 116mm; and flash was used according to the metadata
EndnoteA number of sites are reporting on Apple's new relationship with artists and the iPhones and iPads, called Start Something New, Jeff Beer reports on Fast Create. The campaign features 11 artists who use Apple products and apps in their work. There will be in-store and online galleries to provide inspiration to customers.
On 7 January 7, Apple will bring five of the artists to the West 14th Street Apple store in New York to talk about their work and techniques.
Graham K. Rogers teaches at the Faculty of Engineering, Mahidol University in Thailand. He wrote in the Bangkok Post, Database supplement on IT subjects. For the last seven years of Database he wrote a column on Apple and Macs. He is now continuing that in the Bangkok Post supplement, Life.
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