Friday, 7 October 2011

Legacy of Master Innovator Steve Jobs Leaves Apple in Excellent Position

The co-founder and former Chief Executive Officer (CEO) of tech giant Apple Inc., Steven Paul Jobs, died on Wednesday, of a rare form of pancreatic cancer and related health complications.

"We are saddened by the passing of Steve Jobs, who has proven to be a technology icon, making technology products that were desirable and easy to use. However, we believe this was widely anticipated and even indicated as much in the past few months. The legacy of Steve Jobs and supply chain capabilities of Tim Cook leave(s) Apple in excellent position," said Scott Sutherland, an analyst at Wedbush Securities.

After founding Apple in 1976, Jobs returned to Apple in 1997 to invigorate the Macintosh product line. Jobs followed that up with the highly successful iPod, the iPhone and the iPad and Sutherland expects Apple TV to follow suit.

Like us on Facebook

At the same time, iTunes and the Apple store came to dominate the online music and mobile application markets. This year, Apple is seeing the realization of iCloud linked to an array of connected devices.

Sutherland believes Jobs was a visionary who made products fun and easy to use, which will be tough to replace. He believes Apple still has a strong pipeline of products tied to the iCloud, which he believes was driven by Jobs. That said, with more products expected and the stickiness of the iCloud solution, he believes Apple is in a good position.

The Wedbush analyst noted the recent and expected launches of Lion OS X, 2 new iPods, the iPhone 4S, iOS 5 and the iCloud. Next year, he expects the 4G iPhone 5 and the iPad 3, along with success in the connected TV market.

Furthermore, Sutherland believes no other ecosystem comes close to the ease of use as Apple's, which will continue to appeal to a large percentage of the masses. With only 228 operators distributing the iPhone and only 68 countries for the iPad, he believes there remains tremendous global expansion opportunities for Apple.

In comparison, Sutherland believes RIM and Nokia distribute through about 600 operators. He believes Cook’s logistics capability will be key as Apple expands globally, furthering the company's strong growth trajectory for years to come.

While there could be some negative near-term knee jerk reaction to this unfortunate news, Sutherland believes the pieces are in place for Apple to greatly exceed expectations for the next couple of years, if not more. He, thus, believes investors should take advantage of any weakness.

As an example, Sutherland highlighted the intra-day decline when Jobs stepped down as CEO, only to see Apple shares finish up slightly for the day. Similarly, while unfortunate, he believes this was widely expected and takes another uncertainty out of the stock.

"We believe Apple has solid momentum, a sticky ecosystem, and robust product pipeline to continue to deliver well above consensus results. That said, we believe any weakness should be viewed as a buying opportunity," said Sutherland.

The brokerage reiterated its "outperform" rating on shares of Apple with a price target of $530.

iPhone 5 release date and iPad 3 launch: mystery devices on 2012 tap

The release dates for the iPhone 5 and iPad 3 are both set for next year. The issue up for debate for the rest of this year is which one will land first and how close the two dates will be to each other. That’s before any discussion of what either mystery machine will bring to the table, with Apple having said nothing regarding the feature set or timeframe of either but common sense clues littering the landscape nonetheless. The iPad 3 is the easier of the two to pin down: Apple has launched each of the two iPad generations in the spring. That places the third iPad on tap for a March 2012 arrival unless something goes wrong with its manufacturing or development. Speaking of which, there’s no longer an iPhone release roadmap thanks to whatever was wrong with the iPhone 5 not only requiring a massive pushback from the traditional summertime iPhone revamp period, but also forcing Apple to launch the iPhone 4S in the mean time. The issue now is just how much time Apple was looking to buy with the move…

Despite criticism of the iPhone 4S, it’ll sell well and Apple is now married to it through at least the end of the calendar year. Spring 2012 seems like a logical time for the iPhone 5 release date, giving Apple nearly half a year buffer after the 4S launch. That avoids the whiplash of launching two new iPhone iterations in too rapid of fashion, while also getting the iPhone 5 to market before the 4S push runs out of steam. The problem? The iPad 3 is already occupying the “March 2012″ space on the bingo card. Apple won’t launch two major new iDevices in the same month unless it absolutely has to, and there’s nothing to indicate that kind of urgency. That leaves Apple facing the prospect of releasing the iPhone 5 in a month like February or May, just far enough away from the iPad 3 launch so the two don’t collide in the process. Or Apple could opt to take its time with the 4S and wait until summer 2012 to launch the iPhone 5, which would erase any iPad 3 overlap concerns entirely. That still leaves would-be buyers with the prospect of not knowing what it is they’re waiting for. But there are pieces to put together on that front… 

The iPad 2 was merely a slimmer, more powerful rehash of the original iPad. That points to the iPad 3 sporting a major hardware revamp. Except the acrylic and brushed metal tandem to give way to something new, along with a host of new hardware inclusions. Apple’s next generation A6 microprocessor could be ready by that time, which would give the iPad 3 processing power closer to being on par with that of personal computers than the current A5 can muster. The iPhone 5, meanwhile, should also see a major body style revamp now that Apple has used the same iPhone 4 shell for the original iPhone 4 in summer 2011, the Verizon iPhone 4 in winter 2012, the white iPhone 4 in spring 2012, and the iPhone 4S in fall 2012. Also on the list of potential features for the iPhone 4 are a larger screen, next generation mobile network technology like the 4G LTE being used by Verizon and AT&T and the WiMAX employed by Sprint, NFC mobile payment systems, and a long list of other features which customers are looking for. That list can only be expected to grow between now and the iPhone 5 release date.

iPhone 5 sees five release date scenarios from rosy summer to 2012 fail

As the cadre of would-be iPhone 5 buyers turned to Steve Jobs for answers on its release date, he simply shrugged and talked about how great its software features are going to be once it shows up. His hype-fest merely served to ratchet up expectations and thus excitement for the next generation iPhone 5 while failing to give any real hint as to when it’s coming. As such, the question we get asked most often, “When is the iPhone 5 release date?”, is being asked even more frequently than when the week began. The answer: we don’t know. And neither does anyone else outside of Apple’s innermost posse. But here are five scenarios for its release, along with the realistic odds of each and the corresponding impact.

Very soon. The theory: Apple didn’t unveil the iPhone 5 this week because it wanted iOS 5 and the iCloud to get all the attention. Apple will hold a press conference next week and announce the iPhone 5 on its own. The reality: Not bloody likely. Why would Apple do something so strange?
August. The theory: iOS 5 needs beta testing and developer lead time, and Apple doesn’t want to roll out the iPhone 5 until iOS 5 is ready. Announcing the iPhone 5 this week would have hurt iPhone 4 and 3GS sales in the mean time, so it decided to hold off. The reality: Sounds reasonable…

September. The theory: see the above scenario, except Apple decides to use its traditional early September iPress Conference to launch the iPhone 5. The reality: Feels like the most likely scenario.
Just before the holidays. The theory: Something about the iPhone 5 and/or iOS 5 is running late, and we mean late. But Apple is determined to get it to market before the holidays, so it’ll surface sometime not too long before November’s Black Friday shopping season launch. The reality: You’re getting colder. If Apple really were going to need to leave the iPhone 5 hanging for that long, it likely would have done some sort of interstitial model in the mean time. But such a model would have been unleashed at WWDC, and it wasn’t…

Doomsday 2012. The theory: Apple decides to leave the iPhone 4 as the current model for more than a year and a half, unleashing the iPhone 5 in February of 2012 or so. The reality: aside from fouling up the iPad 3 launch, waiting this long for the iPhone 5 would be too poor of an idea for Apple to even be considering, particularly in light of the fact that it just unveiled iOS 5 which will apparently be ready for public release within months. Do you really see a scenario in which Apple either A) releases iOS 5 this year for the iPhone 4 but with no iPhone 5 in tow, or B) has unveiled iOS 5 now but with no intention to release it until the iPhone 5 is ready next year? Either scenario evokes the phrase “epic fail.” These are both nonsensical, which is why we expect to see the iPhone 5 this year. And because Apple almost never releases major new hardware any later in the year than early September, we’re betting on that scenario above.