2013-01-14

Reinventing $AAPL pie

If we've talked about investment much recently, you'll know that I've been an $AAPL bull, with regards to the period from April 2012 to April 2013. I have a long position on $AAPL which I will probably liquidate, if the January 23 earnings announcement misses analyst estimates by a lot. Otherwise, $AAPL is already trading at such a low PE that I believe that even a near miss is likely to lift the price by a little bit.

Meanwhile, reports of reduced factory orders for iPhone 5 parts are likely to send $AAPL below $500 in today's trading session. Yes, they're saying it's the same month-old news, but hey, folks are easily spooked about this sort of thing.

Speculation
Since writing articles for a friend's gadget blog, I've put a bit of thought into some likely product developments that $AAPL may soon reveal.

A cheaper phone:

The iPad Mini was released at 82% of the cheapest full-sized iPad. I certainly don't think that $AAPL will release a $99-$149 iPhone, unless they're willing to break their recent trend of conservative innovations. If they do stick with a conservative approach, then perhaps we'll see a new iPhone around $369, or 82% the price of the cheapest iPhone, perhaps sporting a larger screen, as rumoured.

Update: Business Insider thinks they could bump-down and make an iPad Nano.

Modding an existing product:

There seems to be room to stuff a mobile baseband and antenna into the iPhone 3G-esque frame of the near-retirement 4th-generation iPod Touch, which already sports the same display as the iPhone 4/4S. This intuitively seems like a quick way to roll out a cheap new product. Comparatively, it doesn't seem like there's room to stuff a phone-sized battery, a baseband, and a bigger antenna, into the relatively high-spec'd and diminuative 5th-generation iPod Touch, or the 7th-generation iPod Nano.

Creating a new form-factor:

In 2007, I bought my first notebook computer, and I'd only had a cellphone for two years, a Nokia 3310. I just wanted a single device that did both. Since then, no one has successfully marketed anything that does all that. Essentially I'm talking about a tablet, with mobile network connectivity, which I can use with a headset to make calls, and which I can use with a dock as a desktop, with support for basic desktop apps.

In 2010, while working at a web startup, in order to see how our pages were rendering on iOS, I got myself an iPhone 3GS, my first $AAPL product. A year later, I got myself a keyboard dock, and used to do server maintenance with the iSSH app, and edit documents and spreadsheets synced to the cloud, on my iPhone 3GS. It was close to my ideal device, just too bloody small. A little later, I got the iPad 2, in order to use GoodReader. The iPad 2 used the same dock that I used with my iPhone (upgradeability was the key reason I got the dock in the first place). However to-date, no iPad has come with mobile network connectivity, for voice and text messaging.

Last year, a tear-down of the iPad Mini revealed that it had relatively simple internals. It has a low-spec'd screen, and a massive battery. It could certainly hold a mobile baseband. You know what I really want this January? I want $AAPL to announce an interface that turns the iPod into a headset for the iPad, and I want them to turn on mobile network connectivity in the iPad. This would essentially make the iPad+headset my ideal device. I don't care if they don't bridge the link between the iPod and the iPad, and instead launch a funky new headset of some sort. (We've seen them apply for such patents.) I just want my one computing device that basically does everything. Of course, in order to qualify as "one device," whether it's a modded iPod, or a brand new headset, it's going to have to clip nicely together with an iPad.

Sir Ive, if you haven't figured this out already, I sure hope you're reading this.

$MSFT Surface Pro... TURN ON THE DAMN GSM CHIP !@#$%^&*()

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