Posted on 01/26/2008 6:47:28 PM PST by RS
“They are the ones who have prohibited sound over the internet on the iPhone... too much chance someone will find away around THEIR business model and stop paying them. They just won’t allow that to happen.”
You mean since Apple takes a cut of revenues, they have a vested interest in making sure the iphone never gets voip capability ? Even when used on WiFi ?
Whod’a thunk it ?
“They are the ones who have prohibited sound over the internet on the iPhone... too much chance someone will find away around THEIR business model and stop paying them. They just won’t allow that to happen.”
I’m sure they will fight it but they will lose. They’ll need to change their business model - they’re fighting economics, technology and logic. It’s already happening.
http://www.engadget.com/2007/12/31/ipod-touch-sip-voip-application-videoed-in-action/
The surviving medium for the foreseeable future is going to be the internet - it’ll take over the phone lines soon and the video delivery (including live video) in the not too distant future. The telcos that can’t or won’t adapt to that reality will be history.
I wonder if that is why google is interested in the new spectrum that is coming up for auction.
http://mydd.com/story/2007/5/22/223953/273
You do realize that Apple is also selling phones outside of the US don’t you?
my son works at one of the many apple stores. he is always telling me of buyers coming in and purchasing 5 phones and then ask him how they can unlock them.
Note: He does NOT instruct them how to unlock them.
They are warned that if the phone is unlocked, the warranty is NULL AND VOID.
Actually its a made up number - just like her other numbers. Apple maintains a three week pipeline of goods, not five weeks as the author assumes... and at the rate of 22,000 units per day on average times 21 days of iPhones represents 462,000 iPhones.
Mike Elgans Moronic Tirade on the iPhone.
Tom Krazit of CNet and Eric Savitz of Barrons deny the Jesus Phone.
“Apple maintains a three week pipeline of goods, not five weeks as the author assumes... and at the rate of 22,000 units per day on average times 21 days of iPhones represents 462,000 iPhones.”
But... But ... Apple counts units shipped as units sold, so even if those 22,000 units per day never leave the retail shelves, more units must be produced, shipped and “sold” to keep the pipeline full.
... unless Apple DOES watch how many units actually leave at the retail levels and adjusts it’s production up or DOWN to account for it ....
... and considering they get a percentage of the revenues of activated units they should know EXACTLY how many units are out the door at the retail level but never activated.
Are they counting the ones bought over the internet? They are shipped directly from Shenzhen. Lots of people bought them that way.
“Are they counting the ones bought over the internet?”
Is WHO counting them ? Apple is counting everything that’s shipped as sold - AT&T reported activations, the other Europeans reported numbers, but no explaination as to sold or activated.
So we are left with Apple saying they sold ( shipped ) 4 Million, and the operators reporting at most 2.7 Million legitimate activations.
That’s 30% of production either still sitting on the shelf or having been hacked.
No, units shipped are not units sold. Apple is its number one retailer... Apple's Retail stores do not count because Apple still owns them and any inventory at the stores has not been sold and Apple has booked the sales they claim. They also have $1.3 Billion in deferred income from the sales of iPhones which is matched by money in the bank. They sold the number they said. If they had not, they would not have booked them... nor could they have deposited the deferred income in their cash holdings.
They claimed these numbers in official reports... if they had not sold what they claimed, the officers would be in dire trouble with the SEC. Microsoft was caught packing the supply chain with several million XBox360s, something they could do because they had several tens of thousands of outlets. Apple does not... and therefore cannot stuff "inventory" into the retailers.
Apple is also limiting the number of iPhone's retail customers can purchase... something they would not be doing if they were trying reduce unsold inventory or trying to inflate their sales numbers.
... unless Apple DOES watch how many units actually leave at the retail levels and adjusts it’s production up or DOWN to account for it ....
Of course they do. Apple brought on board their Chief Operating Officer just exactly because he was the foremost expert on "Just in Time" inventorying to do exactly that.
... and considering they get a percentage of the revenues of activated units they should know EXACTLY how many units are out the door at the retail level but never activated.
And, again, of course they do. They know how many have not been activated. What they DON'T know is how many of them are being held pending activation at a later date for various reaons.
The only people who seem to have a problem with the numbers are some bloggers and pundits who haven't a clue. Apple has released the official numbers of iPhone's sold... the others are spreading FUD.
Again, RS, Apple is only reporting product that is SOLD as sold... Apple is booking only a small percentage of the sale of iPhones and putting the balance on the books as unearned, deferred income. They have stated that they will be booking the deferred income over a two year period... 12.5% each quarter. So, let's look at what Apple has placed on its books as deferred income and what it has deposited in the bank that isn't accounted for as earned income.
Apple claims 4 million iPhones sold in the last quarter. Revenue from the sale of that many iPhones is $1,596000,000 assuming all of them were sold at $399 (it will be something less than that since some were sold by AT&T and were sold by Apple to them at a discount), but then some of that would be offset by the 1,000,000 or so that were sold at a $100 (after $100 rebate) premium. In any case, let's assume the figure is about $1.6 billion.
Apple booked only 1/8th of that per quarter... 2 quarters of iPhone sales equals ~1/4 of the $1.6 Billion claimed as profit which equals $400,000,000 taken as revenue with the rest booked as deferred revenue... $1,200.000.000. (This is just a ball park figure because more iPhones were sold in the last quarter than in the third quarter and that would tend to increase the amount that was booked at only 1/8th of the actual income.) However, the important thing to note here is that Apple has had an increase in its cash reserves of 1.3 billion dollars more than can be explained by its claimed earned revenue... and this 1.3 billion dollars of CASH is really close to our estimated 1.2 billion of unearned revenue... and the exact amount that Apple has booked as unearned income. (Apple is also booking AppleTV sales in the same manner.)
The revenue, ~$400 million as current revenue and ~$1.2 billion as deferred income, which just happens to equal the revenue from approximately $1.6 billion of iPhone revenue.
Therefore, Apple has indeed sold 4 million iPhones.
“Apple is also limiting the number of iPhone’s retail customers can purchase...”
That’s probably the most obvious hoax - The Sunday papers have those kinds of advertising all the time.
When we hear a story of guys driving from store to store with a van full of iphones, like we do occasionally with the pre-paid phones, then I might think there is some reason besides hype.
“Apple is booking only a small percentage of the sale of iPhones and putting the balance on the books as unearned, deferred income. They have stated that they will be booking the deferred income over a two year period... “
So let’s see, Apple sells the phone and gets paid for it ( earning the income ) ... the deal is done, yet APPLE somehow gets to put that cash into the bank as “cash reserves” to earn interest while claiming that they are pretending that the purchasers will pay them over the next two years.
Isn’t it much more likely that the 2-year defered income is income that is expected over the next 2 years from the percentage that APPLE makes by the activated customers being locked into a 2 year contract ?
Re: hoax
No, it isn’t. I’ve seen people refused at the Apple Store in Sacramento when the limit was two. You also cannot buy an iPhone with cash. It has to be a credit or debit card.
Re: “...the deal is done...”
Not according to GAAP (Generally Accepted Accounting Principals), it isn’t.
Apple will continue to deliver more of the iPhone “deal” over the next two years in the form of added applications and functionality at no additional cost to the buyer.
Income from Apple’s contract with AT&T is booked as it is received and has nothing to do with the original iPhone transaction.
While the money from the iPhone sale is placed in cash reserves it is offset by a liability (owed to the iphone owners in general) that can only be reduced when Apple provides additional functionality to the iPhone’s owner over the next couple of years.
“While the money from the iPhone sale is placed in cash reserves it is offset by a liability (owed to the iphone owners in general) that can only be reduced when Apple provides additional functionality to the iPhone’s owner over the next couple of years.”
????
Just who decides what “additional functionality” fullfills the liability ?
They apply the reasonable man approach and it's simple... Does the iPhone does something more that it didn't do before? If it does, that's added functionality. If the function was there and didn't work properly, any update that fixes the problem is not counted as "added functionality" but an update that fixes the problem and ads bells and whistles, something new, or an entirely new application, does get accounted this way.
I recently posted a reply to a discussion of why the iPhone was getting software free that iPod Touch users had to pay for that included some links to some discussions by professional accountants on dealing with the problems of accounting for software upgrades for already sold and accounted for products:
Regarding Jobs not being forthcoming, that has to do with his justification of the 802.11n upgrade’s $2.99 pricing. The same “logic” is being applied here, and it has no place.Fine, you are free to ignore the facts as I have presented them because you prefer to believe fantasy. Go ahead and be pissed off. Why not return your iPod and be done with it?
So, basically, they snookered us.
Since you prefer to believe venal motives for Apple's decision, you probably won't want to wade through the detailed analysis published in The CPA Journal (published by the New York State Society of CPAs in April, 2005) about The American Institute of Certified Public Accountants (AICPA) Statement of Position (SOP) 97-2 and Emerging Issues Task Force (EITF) Issue 00-21, both of which deal with the problems of accounting for software upgrades to already sold and accounted for products. Both of these issues have been recently been incorporated into GAAP.
Yes, Apple COULD have handled it differently: They could have deferred some income from the sale of your iPod... but they didn't, concluding that it was a complete product when it was released and that there was no future revenue stream potential from that completed sale. They could also have not released the upgrades and just kept the iPod Touch locked. Or they could have delayed releasing the iPod Touch until all potential upgrades were developed and available to be included with the original sale. They didn't. All of those have other downsides as well and Apple found a least problem trade off. The charged a reasonable price for software they sell... wow, who would guess they sell software?
223 posted on 01/18/2008 11:13:41 PM PST by Swordmaker (We can fix this, but you're gonna need a butter knife, a roll of duct tape, and a car battery.)
Wow ... I had no idea what they were doing with the itouch -
Do I have it right ? If you want to update your touch to the 1.1.3 version of firmware you MUST buy it in a bundle with 5 apps you may or may not want ?
Re: update
No, you don’t have it right. The firmware update is free - the software additions are $19.95. You don’t have to buy them to up date the OS.
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