Apple, iPhone, Irrational Exuberance, Etc.
from the invest-with-confidence dept
You might have heard that Apple's released a mobile phone tomorrow. Since this "iPhone" device was announced back in January, a nice $34 billion or so has been added to Apple's market cap by investors. Breaking Views compares that to Nokia's market cap, which stands at $108 billion -- despite the fact that it will sell 55 times more handsets than Apple at the end of the year. The piece argues that the $34 billion increase in Apple's market cap reflects investors' perceived value of Apple's phone business, and using Apple's reported margins of 13% -- which happen to be identical to Nokia's -- the phone business is valued at 100 times projected 2008 operating profits. Nokia trades at a much lower 10 times multiple, leading the site to conclude that either it's badly undervalued, or Apple is massively overvalued. Perhaps that's true, though the runup in Apple's share price reflects the ridiculous level of hype and expectations for the iPhone, and it's something that could change quite quickly should the device not prove to be an overwhelming success. Furthermore, it just reinforces the reality that stock prices are disconnected from a company's underlying business, and often have far more to do with investors' perception of a company than financial reality. Also, watch for Apple stock to tumble a few points Friday, as investors dump their shares so they can finance their own iPhone purchases.French Officials Can't Resist Their Crackberries, Even If It Means Giving Secrets To American Spies
from the must...-use...-crackberry dept
We've all heard the RIM Blackberry referred to as a "Crackberry" for its supposedly addictive nature... however, we never thought that it was true that anyone really couldn't do without their Blackberry mobile device. Apparently the French government has banned the devices for certain government officials who might email sensitive information. Since RIM has all emails run through its own servers, some of which reside in the US, the French government is worried (perhaps reasonably so) that American spies are snooping on their sensitive emails. However, apparently many French government officials just can't let go and are still using Blackberry devices on the sly... even if it means sending classified info. What's odd is that various officials say they can't find anything else that works quite like the Blackberry, even though there are more and more solutions that do -- and many of them don't require emails to go through special servers in the US.The Real Loser In Amp'd's Bankruptcy: Mobile Porn
from the leap-of-logic dept
As the dust continues to settle around virtual operator Amp'd, which recently filed for bankruptcy, the New York Times has a rather bizarre article focusing on some of the collateral damage. Namely, it says that the growth of mobile porn will be stunted by the filing, since apparently Amp'd was the closest of any US carrier to selling porn, as it "let subscribers download pictures of fully clothed pornography stars and models." US operators have thus far resisted selling adult content, both because they don't have systems in place to restrict minors' access to the content (also known as the porn license) and because they fear the backlash of being seen as porn purveyors. Of course, plenty of third-party mobile porn shops exist outside carriers' content decks, but apparently that's not good enough to assuage the NYT's fears for this nascent industry.Here Come The iPhone 'Rivals'
from the groundbreaking dept
As the June 29th release date of the iPhone draws closer, the circle of hype around it swells even more, particularly among members of the media for whom the functionality of the iPhone represents something new -- even when it isn't. A side effect of this will see plenty of new handsets labeled "iPhone rivals", simply because they're mobile phones. But some companies are coming out with devices that mimic the iPhone in many ways -- such as Microsoft's favorite white-label manufacturer, HTC, which has announced its touchscreen-driven "iPhone rival", creatively named the Touch. Of course, there's only one problem: the touchscreen interface sucks, and is apparently barely usable. Plenty of devices will, unfairly or not, get compared to the iPhone by the media. But if your company is going to portray one of its own devices as a worthy competitor to the iPhone, it would help if it was actually a decent product in its own right.PE Takes A Bite Out Of Palm
from the we-buy-you dept
Rumors about a buyout of Palm have been doing the rounds for months, but hadn't come to fruition. Today, however, Elevation Partners, the Silicon Valley private-equity firm which counts Bono among its partners says it's buying 25% of Palm in a somewhat complicated deal. Existing shareholders will be getting some cash in exchange for their reduced stake, while Elevation Partners gets a quarter of the company and will install a number of new personnel. Jon Rubenstein, an Apple veteran that oversaw the company's iPod unit, will come in as executive chairman and head of product development, replacing co-founder Jeff Hawkins in the latter role. It's slightly interesting timing, given that Hawkins oversaw the development of the Foleo, the "smartphone companion" product that was announced last week to a widely underwhelming response. On the face of it, this deal and injection of some fresh thinking sounds like exactly what Palm needs to survive in a market with which it's increasingly out of step. Palm's problems may be the cause for the complicated deal, with one writer wondering if it went down this road because nobody was interested in buying the whole company. The deal won't immediately solve any of Palm's long-running problems, but it does offer some hope for the company over the longer term -- and with several ex-Apple execs now on board, the thought is that Palm's in a similar position to Apple before the iPod, and the hope is that it will follow the same path.Didn't See This One Coming, No Not At All -- Amp'd Files For Bankruptcy
from the not-surprising dept
About two years ago, a group of execs that had founded the successful Boost Mobile youth-focused brand for Nextel announced they were starting a new virtual mobile operator called Amp'd. Amp'd would also target young users, but it would differentiate itself by charging high prices and, in exchange, offer all sorts of multimedia content. From the outset, we were skeptical because the company was focusing on content, and not communication -- a strategy that's proved untenable for other MVNOs, and similarly failed for Amp'd, so it was forced to try and attract users by slashing voice prices. Still, the company's business plan (poor strategy and all) helped it pull in $360 million in venture funding, with a good chunk of that coming even after the company displayed an inability to attract subscribers. So, in what's one of the least surprising pieces of news we've seen in a while, Amp'd has filed for Chapter 11 bankruptcy. The company spins bankruptcy by saying, "As a result of our rapid growth, our back-end infrastructure was unable to keep up with customer demand." The company was beset by operational problems (as well as poor strategy), so there's some truth in that, but with so few users, it's not much of an excuse. Amp'd says it hopes to secure more financing and keep operating, though its top creditors are Verizon Wireless, its network provider, and Motorola, which provides it with handsets, owing them a combined $49 million. We would say that Amp'd will have a hard time finding more investment, but given that the company was able to raise so much money from VCs even after it was clear it was headed for the deadpool, you never know.Stick A Fork In Palm
from the 'cause-they're-done dept
Palm had done its best to whip up a frenzy leading up to today's announcement from founder Jeff Hawkins about some new mystery product. Well, it's here, and despite Hawkins' proclamation that it's "the most exciting product" he's ever worked on, the Foleo "smartphone companion" isn't exactly overwhelming. Basically, it's a $500 screen and keyboard for Treo smartphones, which the company is pitching as an email device. The Foleo syncs to a user's Treo inbox over Bluetooth, and lets users view and compose emails, and it features an Opera web browser and a photo-viewing application.It's hard to understand the point of the Foleo, or why Hawkins and Palm think it's so wonderful. There are two ways to see it: first, as an admission that Palm won't ever be able to create a Treo that will satisfy users' needs, or an admission that they think their Treos are perfect and this is the only way they can figure out to improve on it. Neither is particularly good for the company. The Foleo's hardly compelling, when $500 fully-featured laptops are pretty common these days, while the future lies in crafting more powerful and useful smartphones, not in simply relegating them to serve as a modem for a redundant bigger device. The unspoken marketing message here is that users need to shell out for the Foleo on top of a Treo because the smartphone doesn't deliver an acceptable user experience for mobile email. Palm would be far better off improving its outdated smartphones, instead of focusing on creating new (and pointless) product lines, but it's really beginning to look like that's asking too much of the company. Update: As noted in the comments, apparently the Foleo is open to external applications. As Palm puts it, "Its Linux-based operating system and built-in Wi-Fi radio make it easy for developers to create new applications that can be installed with a single click in the browser" -- though Palm's not released any information for developers, nor given any indication of how strongly it will engage the open-source community.
