Apple has finally sent out invitations to reporters to an October 4th event, setting the stage for the widely anticipated launch of iPhone 5.  Apple is going to unveil the new model of iPhone just 16 months after the iPhone 4 debuted, and hence there is a huge pent-up demand for it (see Survey Says iPhone 5 Demand is Sizzling).
Moreover, the new iPhone could help expand the number of wireless providers for Apple with Sprint joining ATT and Verizon as iPhone providers in the U.S. market. (see Sprint’s Stock Finds New Life on iPhone 5 Announcement).
Despite the highly anticipatory build-up, we believe Apple will have to come up with attractive features for iPhone 5 if it wants to have the same impact and draw as iPhone 4. The new features will also help it overcome increasing competitive pressures from the Google camp, which has gained a significant presence in the smartphone market through its Android operating system. It could also help widen the gap that Apple enjoys against Blackberry iterations from embattled Canadian smartphone purveyor Research in Motion.
The iPhone is the most valuable business for Apple and accounts for more than 50% of our $510 price estimate for Apple stock. Our price estimate is about 25% above market price.
Former Vice President Al Gore, now an Apple board member, let slip this month in a speaking engagement that new editions of the iPhone were on the way in October. To live up to the hype that the former veep helped to stoke, Apple needs to show some big strides.
Processors, Camera, Graphics, Network, Design
We believe that the new iPhone could have faster A5 processor, improved camera, improved graphics performance, faster network technology and potentially be thinner and lighter. We also expect additional feature announcements related to the upcoming iOS 5 update and Apple’s iCloud service. These features will be key if Apple wants to increase its presence in the mobile phone market.
There has been speculation that Apple could unveil two different versions of iPhone. A report from JPMorgan suggests that the iPhone 5 will be a world phone with support for both GSM and CDMA technology, and a revamped iPhone 4 will be a low cost phone specifically targeted for emerging markets (see Speculation About New iPhone(s) Lifting Apple?s Stock).
The reception and potential impact for the iPhone 5 is a big driver for Apple’s stock, and so we eagerly await this announcement.
- Apple iPhone 5 Event Set for Oct. 4, PCWorld, September 27th, 2011 [↩]
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If patience is a virtue, then iPhone 5 enthusiasts are angels. But after months of waiting for the highly anticipated gadget, it seems there’s finally a light at the end of the long, dark tunnel we like to call Steve Jobs’s genius marketing strategy. Yep, on Oct. 4, Apple is set to unveil its newest iPhone.
Sure, the much-hyped iPhone 5 release has tested our patience, but it’s not the only long-awaited arrival we’ve have had to weather. From the final Harry Potter book to Sony’s PlayStation 3, click through for a look at the things we’ve had to hold our breath for.
Apple’s plans to introduce the iPhone 5 on Oct. 4 have spawned a huge wave of the typical informed speculation, trendy rumor, and uninformed innuendo that precede every Apple announcement, but I want to share the most-intriguing report I’ve heard.
What makes it worth repeating is that it comes from an Apple follower and investor named Jason Schwarz, whose commentary over the past few years about Apple and its strategy, products, and financial performance have been exemplary. Not long after the original iPhone debuted in 2007—and this was way back in the days before Apple had become the most highly valued company on the planet—Schwarz was perhaps the first advisor to proclaim (and he did so loudly and repeatedly) that Apple’s breakthrough smartphone was triggering an enduring wave of mobile innovation that would push Apple’s stock price up to and past $300.
With that backdrop, I’ve come to place a fair amount of trust in Schwarz’s analyses of Apple, which this time around include some jaw-dropping claims about the power of the iPhone 5’s new voice technology (and before I insert this excerpt from Schwarz’s analysis, bear in mind that this guy is an investor and investment advisor and that he holds long positions on Apple):
At the original iPhone event in January 2007, Steve Jobs stated, ‘We are all born with the ultimate pointing device-our fingers-and iPhone uses them to create the most revolutionary user interface since the mouse.” Well, I would add that we’re also born with the ultimate communication tool-our voice-and iPhone is about to create the most revolutionary user interface in the history of technology (emphasis added). I expect that this voice assistant will quickly make its way into laptops and desktops as well. Apple’s competitive advantage is widening by the day. (End of excerpt.)
That’s quite a claim. And Schwarz makes such an audacious forecast because he believes the iPhone 5’s new capabilities will create for Apple a breakthrough level of competitive advantage in its battle with Google: “Voice search, rather than browser based search, could prove to be a real threat to Google’s dominance,” he writes. And here’s how that could play out, thanks to Apple’s acquisition last year of the Siri voice-assistant technology:
The Siri voice control system allows users to instruct the iPhone to ‘send a text message to Jason Schwarz asking him meet me for lunch’. Think about this capability in terms of safety. We all know that too many drivers send and receive text messages, now they will be able to safely operate an iPhone in the car. The voice assistant adds a layer of intelligence as well. If I ask my iPhone to ‘call Dad’ it might ask me whether it should dial his home phone or his mobile. It is also able to perform Web based search functions such as ‘book a table for two at 9:00 tonight’ or ‘send a taxi to my house’. Siri worked with Citysearch, Opentable and Taxi Magic before the Apple acquisition.(End of excerpt.)
For CIOs and the mobile workforces trying to deliver real-time insight and decision-making to the point of the customer, any additional layer of intelligence can truly be a game-changer as rapidly growing numbers of professionals begin to rely on smartphones and tablets as their primary computing device.
In fact, with these reported new capabilities for the iPhone 5, we shouldn’t be surprised if Apple, during its earnings call on Oct. 18, is able to report that it’s come even closer to having 100% of the Fortune 500 testing or deploying its mobile products. The most-recent corresponding numbers reported by Apple in late July were in the mid-80’s.
But even having made his claim that iPhone 5 will include “the most revolutionary user interface in the history of technology,” Schwarz made yet another remarkable forecast in his piece called ‘Let’s Talk’ iPhone 5 Is a Game Changer. After touting the iPhone 5’s implications for Apple’s iCloud business and highlighting how trends in mobile retention rates are favoring Apple over its competitors, Schwarz says he expects Apple to double the total number of iPhones it sells in the fourth quarter of this year compared to last year’s Q4:
After witnessing 142% unit growth for the iPhone in Apple’s most recent quarter, we believe that the upcoming iPhone 5 will command a similar growth trajectory in the holiday quarter. Last year Apple sold 16.24 million iPhones, this year we expect they will sell at least 32.48 million units. (End of excerpt.)
September 28, 2011 by Bill Palmer
by Bill Palmer
Apple is six days away from taking the lid off what the public hopes is an iPhone 5 complete with a 2011 release date, what could be an iPhone 4S under a pair of very different circumstances, and what will certainly be the new iOS 5 operating system. In addition to existing Verizon and ATT iPhone iterations, Sprint could join the club as well. Other new product categories, from the iPod touch 5 to the iPad 3, are on the table for the October Apple Event to varying degrees. Lacking a crystal ball but having observed Apple’s actions and motivations, here’s a rundown of our odds of various products and concepts coming to fruition at Apple’s October 4th event.
iPhone 5: 82%. The widespread assumption is that Apple’s “Let’s talk iPhone” tease is in reference to the iPhone 5, and that’s probably a correct one. However, it’s no guarantee. The “talk” part of the invite is in reference to Apple’s unannounced new Assistant feature of iOS 5, which allows you to control your iPhone in a human manner simply by speaking to it. Apple’s choice to focus on an iPhone software feature rather than new hardware aspects in its tease leaves the door open to the scenario in which Apple never was able to get past the component and/or manufacturing issues which dogged the iPhone 5 all summer, and are now instead coming to market with an iPhone 4S. That would push the iPhone 5 release date well into 2012, and would result in some unhappy customers. About that iPhone 4S…
iPhone 4S: 50%. There are two ways in which the 4S can play into Apple’s 2011 puzzle, one of them exciting and the other not so much. The first is the doomsday scenario in which the iPhone 5 isn’t ready and the 4S is a substitute. Put that at 18%, to counter our 82% odds of an iPhone 5. The other 32% comes from the scenario in which the iPhone 5 arrives with the iPhone 4S as a sidekick. The reasons are multiple: the current iPhone 4 won’t power Assistant, or so we hear, so the 4S will have the same A5 processor as the iPhone 5 and iPad 2. A single 4S unit would eliminate the separate Verizon and ATT units, while adding Sprint compatibility.
Sprint iPhone: 67%. There’s at least twice as much evidence in favor of a Sprint iPhone 5 (and/or 4S) as there is against it. Sprint execs have teased it publicly without quite confirming it. Sprint employees have installed signal boosters around Apple Stores. Come to think of it, there’s really no concrete evidence to suggest it won’t happen.
T-Mobile iPhone: 0% T-Mobile itself has confirmed it won’t get the iPhone 5 this year. It didn’t say why, but the eight hundred pound elephant in the room is the ongoing merger talks with ATT, which would seem to preclude T-Mobile from doing its own deal with Apple in the mean time…
iOS 5: 100%. The only sure bet is the iOS 5 operating system itself. Apple previewed many of its major features this summer, and will reveal the remainder of them next week. It’ll run on whatever new iPhone(s) Apple introduces, plus the iPhone 4 and 3GS (in limited capacity), and all iPads.
iPad 3: 2% If this were to be a co-headlining event in which the iPhone 5 and iPad 3 debuted together, the invitation would have reflected as much. If the iPad 3 were to get its own separate event, it would have happened before this one, not after; the holidays are too close at this point to have another event in November for a new iPad. If there is to be a new iPad this year, it’ll be something quieter like an iPad 2S.
iPod touch 5: 50% We give it equal odds as to whether Apple upgrades the iPod touch 5 with 3G or 4G networking and makes it a powerful device, or merely kills it off in recognition of the iPhone 5 working on most carriers. Would a contract-free iPhone surface to take the place of the iPod touch? That may be the more interesting question.
iPod nano, shuffle: does anyone care? Somewhere in the rundown will be the debut of the new traditional iPod lineup. Those models still sell well, but they’re inexpensive and considered commodities. We’ve lost count as to what generation the nano and shuffle are even on, let alone what new features they might gain in their next revision.
Here’s more on the iPhone 5.
Updated 10:50pm PST with additional information regarding T-Mobile and Apple
It seems that Samsung Galaxy S2 is in a relatively week position when we look at the sales volume of the predecessors of the two competitors. According to AFP, Galaxy S, the predecessor of the Galaxy S2, sold 14 million units worldwide by April 2011. It is not quite comparable to the iPhone 4, which has been sold 77 million so far, according to Wikipedia. Nevertheless, this does not mean iPhone 5 will definitely be the winner. Although rumors claim it will have many fancy features, we cannot make any conclusion until we see its specification.
On the other side, Samsung has just gone ahead and announced that they have broken the 10 million sales barrier record. The number doubles their previously announced 5 million back in July. The Samsung Galaxy S2 features a dual-core processor, a 4.3-inch (or 4.5) Super AMOLED Plus display, 1080p HD video recording, 1GB RAM, 16GB or 32GB storage options (plus microSD up to 32GB), a GPS, Wifi b/g/n, 8-megapixel rear-facing camera, 2-megapixel front-facing camera for video chat, USB 2.0, 1650mAh (or 1900mAh) battery and Android 2.3 Gingerbread with Touchwiz 4.0 UI.
What do you think? Who will be the real winner between iPhone 5 and Samsung Galaxy S2?
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By Richi Jennings (@richi ) – September 28, 2011.
Let’s talk iPhone. Specifically, about the iPhone 5 release date. Apple (NASDAQ:AAPL) fanbois everywhere have been waiting for this moment, with baited wallets. However, it looks like rumors were wrong about a cheaper iPhone 4S being announced at the same time. In IT Blogwatch, bloggers read the rumor runes.
Your humble blogwatcher curated these bloggy bits for your entertainment. Not to mention: Join with Nile Rodgers and Roseanne Barr on Friday to send a simple, yet powerful message…
Gregg Keizer reports:
The invite was typically terse, composed of a graphic showing several app icons and directions to the event. … Because of Apple’s secrecy, little is known about the next iPhone, dubbed by most as the “iPhone 5.”
Apple is expected to launch iOS 5, the next version of its mobile operating system, either slightly before or alongside. … [This] will be the first Apple smartphone introduction since co-founder Steve Jobs…hinted that he was resigning for health reasons. … [New CEO Tim] Cook will likely lead the presentation next week.
“Little is known?” Pah! John Paczkowski begs to differ:
Matthew Panzarino answers the next obvious question:
We have been told…that you should expect to be able to line up and purchase your next iPhone on Friday, October 14th.
As with anything like this, sources can be wrong…but everything that we have heard so far is pointing to [it] being available a week and a half after the event…[and] that the release of iOS 5 will come a couple of days before, on October 12th.
And Kasper Jade triangulates the release dates:
Apple…has in some locations blacked out vacation time for employees from October 9th through 12th and October 14th through 15th, according to people familiar with the matter.
[T]hat would give the…company roughly 10 days to field pre-orders.
But what’s that red “1″ badge mean? Michael Santo muses:
The upper left icon is clear: the event is on October 4th. The next one is a clock…[so] the event will be at 10. … The third icon is an indicator that the event is being held at Apple’s corporate headquarters.
For the question of whether or not Apple will release one or two iPhones, one could interpret the No. 1…to mean there will be one iPhone launched at the event. … We’ve heard they are close, but there are issues with the screen and the beveled edges planned for the iPhone 5 that may prevent the release of the device this year, we just heard.
And Jonny Evans has been reading too many patents:
Notably, the invitation does not suggest a plurality of phones.
iPhone 5 may also support some interesting new iOS 5 features, including a new virtual assistant…from Apple’s Siri acquisition and also new features licensed from…Nuance.
Apple is reportedly hoping to shift 26 million iPhones in the next quarter.
Meanwhile, Dan Lyons is fed up of all the speculation:
That…latest bit of foaming-at-the-mouth SEO-bait speculation…“could be a clue that Apple is only releasing one iPhone,” rather than two, or three, or seven, or twelve. … Or the number 1 could mean something else. Or…nothing at all.
This then becomes the basis for an article. … And now the basis of [this] post…and yet another reason for me to descend…into a Slough of Despond for what my life has come to.
Hate Free Friday: Join with Nile Rodgers and Roseanne Barr on Friday to send a simple, yet powerful message
[hat tip: Howard Price]
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Richi Jennings is an independent analyst/consultant, specializing in blogging, email, and security. He’s the creator and main author of Computerworld’s IT Blogwatch — for which he has won American Society of Business Publication Editors and Jesse H. Neal awards on behalf of Computerworld. He also writes The Long View for IDG Enterprise. A cross-functional IT geek since 1985, you can follow him as @richi on Twitter, pretend to be richij‘s friend on Facebook, or just use good old email: firstname.lastname@example.org. You can also read Richi’s full profile and disclosure of his industry affiliations.
Though yet to be released, the
iPhone 5 is already on the shopping list of more than 40 percent of those polled by InMobi.
In a study released yesterday, the mobile ad network discovered that 41 percent of mobile users in the U.S., Mexico, and Canada will buy the new
iPhone, with 50 percent of those planning to pick one up within the first six months of the phone’s debut. If those numbers hold true, the iPhone 5 would become the most successful product launch yet from Apple, according to InMobi.
Further, the new iPhone could easily shake up the battle between Apple and
Android by boosting the market share of iOS to 41 percent from its reported 27 percent in June, the study said. A small survey conducted in early August by Piper Jaffray’s Gene Munster found similar results, prompting the analyst to forecast that the iPhone 5 could double Apple’s market share.
iPhone 5 rumor roundup
Android dominates iOS in 2nd quarter, study finds
Android nabs 41 percent share in U.S., study finds
Analyst: iPhone 5 could double Apple’s market share
Apple holding iPhone 5 event on October 4
The iPhone 5 is also expected to steal business from other platforms as it’s being eyed by 51 percent of current iPhone users but 27 percent of Android owners and 52 percent of BlackBerry users. Some of the new features that consumers are hotly anticipating in the new iPhone include better battery life, faster performance, higher screen resolution, and stronger phone service, InMobi said.(Credit:
Though most people may be expecting Apple to unveil a totally new phone next Tuesday, past reports have claimed that the device will just be a revamped iPhone 4 with a few improvements but the same basic features. Even if such rumors prove true, a new “iPhone 4S” will scoop up business from 11 percent of current iPhone users, 11 percent of Android owners, and 28 percent of BlackBerry customers.
As a mobile ad network, InMobi has seen an increase in ad impressions for iOS, particularly in iPod Touch devices. Including all of its mobile devices, Apple currently holds the leading share of impressions on InMobi’s network at 29 percent.
Though demand for its mobile devices is still running hot, Apple’s iOS has seen its once dominant lead in the smartphone OS market overtaken this year by Android. InMobi points to iOS as the top dog on its network, but fellow mobile ad network Millennial Media has been tracking Android in first place since shooting past iOS early this year.
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Will ATT Benefit from ‘iPhone 5 Wave’?
That said, if the iPhone 5 can come close to matching its hype, the next iPhone has the potential spark an “iPhone 5 Wave,” if you will, in the cell phone service provider sector — in other words, a renaissance in the sector — one that attracts new minds (translation: subscribers) that previous had not considered the iPhone 5 or even smartphone service before. Talk about an opportunity for increased revenue and earnings.
And that’s good news, not only for iPhone 5 newbie Sprint, but also for venerable iPhone 5 carrier ATT.
In fact, the “iPhone 5 Wave” could be just what ATT needs to attract new, younger-adult subscribers to its network: the revenue increase will also make it possible for T to better-fund it capital spending, including network improvements to account for the increased data traffic and multi-media traffic.
To be sure, the U.S. Justice Department’s objections to ATT’s planned buy of T-Mobil USA’s assets is an operational negative, but almost all of ATT’s other metrics are flashing “green” as in “go” and “buy.”
ATT has a strong balance sheet, long-term customer relationships, gobs and gobs of research talent (even it can’t compared to the old Ma Bell), and solid margins to practically say, “back up the truck” from an investment standpoint.
Wireless, Broadband Gains
In 2011, gains in ATT’s consumer wireless and broadband will continue to make up for landline (wireline) downside revenue pressure. Wireless revenue should increase 6-9 percent in 2011 and 5-8 percent in 2012. Wireline data should perform decently, on U-verse and enterprise operations. Margins should be about 19 percent in 2011 and near 20 percent in 2012.
T also had 41.3 million voice connections (down 10.3 percent in 2010) in and 16.5 million broadband connections (up 3.3 percent) as of June 2011, and 98.6 million wireless subscribers, (up a gargantuan 9.4 percent in 2010).
ATT’s revenue should rise to $127 billion in 2011 and $129 billion in 2012, up from $124 billion in 2010, led by customer gains and faster growth in wireless services. Also wireline data gains should help offset continued attrition of consumer and business voice (landline) operations.
The Thomson Reuters First Call FY2011/FY2012 EPS estimates for ATT are $2.37 and $2.54.
Technically, ATT shares formed a bear hug this summer, but found support at $27. ATT faces a psychological hurdle at $30, but once that is cleared, there is scope to $35 and beyond. T should trade above $35 by the end of 2011 and at $40 by mid-2012.
What’s more, ATT recent re-test and hold of support at $27 provides further technical confirm that a bottom is in place $27.
Stock Category: ATT is ideal for investors who want a comparatively safe, dependable company and stock investment. Don’t look for gargantuan growth with ATT. There’s only a 5 percent chance you’ll lose your entire investment with ATT over a 10-year period. And you’ll like the $1.72 annual dividend.
2011 Outlook: I view ATT as a long-term play, but if you’re looking to sell T within the year, it’s probably best to take your profits after it rises to $33-34, if it fails to rise above $35.
Stock Analysis: ATT is a low-risk stock. If an investor has already purchased the company’s shares, I’d hold them. If not, I’d consider buying a 50% position in T now. Under any circumstance, I wouldn’t buy more than 75% of my T position before January 2012 and I’d put a sell/stop loss at: $13.
Disclosure: L.C. Jacobs of New York, N.Y. reviews stocks on a quarterly, semi-annual, and annual basis.
L.C. Jacobs has no positions in stocks reviewed, but does own federal, municipal, and corporate bonds.
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After the announced partnership between Apple and ATT and Verizon for the upcoming iPhone 5 and rumoured alliance with Sprint; T-Mobile seems desperate not to be left aside. Cole Brodman, T-Mobile Chief Marketing Office, spoke recently at the Mobilize 2011 conference, expressing his frustration about the situation.
At the event, he mentioned the new devices the company is offering to customers such as: the Sonic 4G mobile HotSpot, HTC Amaze and a version of Samsung Galaxy S II, although he seemed rather annoyed at the inevitable hints about the iPhone 5.
The speech about the success in selling Android phones and improved network speeds could not avert attention from the topic of a possible partnership with Apple for the new iPhone. Brodman confessed that T-Mobile expressly asked Apple to be considered as a carrier for the iPhone 5 but the confirmation never arrived. Information leaked from a T Mobile executive reveals that there is little hope of that happening at the moment. Apple’s reluctance might very well be related to the fact that ATT is currently in the process of acquiring T-Mobile.
Later, Brodman addressed a letter to customers on the company’s blog. On the subject of the expected iPhone 5, he admitted genuine disappointment: “Please know that we think the iPhone is a great device and Apple knows that we’d like to add it to our line-up. Today, there are over a million T-Mobile customers using unlocked iPhones on our network. We are interested in offering all of our customers a no-compromise iPhone experience on our network”.
Amazon’s Kindle Fire is a cheap, but very powerful tablet, challenging the upcoming price tag of the iPhone 5.
Amazon’s Kindle Fire is not a smartphone, but it is a media device that may convince many online customers with a very attractive tag price of $199. Yes, no contract, just $199 and you’ll get an OMAP4 dual-core processor and Android operating system-powered tablet that you can use to browse the web, download games like Angry Birds and Cut the Rope, and read e-books and e-magazines.
The announcement of the Amazon Kindle Fire is a week ahead of Apple’s scheduled iPhone 5 announcement, so we’re seeing a two-week party with electronic devices that will arrive before the shopping season, November. The Kindle Fire will arrive in United States on November 15, while the iPhone 5 is expected to hit store shelves (in USA) in mid-October. It is highly possible that the iPhone 5 will arrive in the market before the Kindle Fire.
No word yet on the price tag that the iPhone 5 will use, but it is highly expected that Apple will use the same price tags used by the current iPhone 4, which is $199 on contract for 16GB and $299 on contract for the 32GB. Apple is also selling the unlocked iPhone 4, so an unlocked iPhone 5 is also highly possible.
According to rumor mill, the iPhone 5 will sport dual-core processor and an 8-megapixel primary camera as the new features to compete against Google Android’s powerhouse, now including the Amazon Kindle Fire.
Not all consumers can afford to buy new electronic devices, so the iPhone 5 and the Kindle Fire are considered as indirect rivals, mainly because both devices are considered “media” devices, and these media devices are the backbone of Apple and Amazon’s money-making businesses, the app store, e-books store and the music store.
Amazon is joining the tablet market obviously because they want to increase their online revenue with more sales of mp3 songs, e-books and applications, and these products are also the money-making products sold by Apple with its iPhone and the iPad, Apple’s popular tablet PC.
With the iPhone 5, Apple can increase its apps, e-books and digital music revenues. According to analysts, Apple is expected to ship millions of iPhone 5 before the end of the year, and millions of iPhone 5 also means millions of digital sales for the Cupertino, California-based company.
Can Amazon rival Apple with the new Kindle Fire? The aggressive price offer of Amazon is quite a shocker, in my opinion.