Friday, March 30, 2007
Analyst suggests Apple get out of cell phone business
I read a recent news blurb on Schwab.com where a prominent financial analyst suggested that Apple was foolish to enter the cell phone market at this time. He said that the current cell phone market is consolidating and that the cell phone will become a commodity real soon with small profit margins. He commented that unless Apple has three or four models in the works the hype around the new iPhone would end up fading away in about 6 months, just like it has done with other cell phones. When asked what Apple brings to the table, he said that the success with the iPod is based on popular advertising primarily and that will not be enough in the cell phone market. His suggestion was that Apple sell the rights of the iPhone to Samsung. Coincidentally, the day these comments were released, Apple's stock dropped almost 2.5%.
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4 comments:
I dug up the article and found that the author was John Dvorak who is actually a technology columnist not a financial analyst. He writes for many publications such as Marketplace and PC magazine. I checked on Wikipedia who he is and found that he has a history of being anti-Apple. In 1984 he wondered why Apple included a mouse with their Macintosh when "there is no evidence that people would want to use these things". I guess with a history of poor predictions like this, we can take his comments with a grain of salt. Yet he is a highly acclaimed columist none the less.
Stitch, the "analyst" is a guy named Dvorak who is known for "Trolling". That is, he knows he can write something utterly stupid to anger Mac users, and he knows we're so passionate that a bunch of us will immediately read the article and write nasty letters to him. In fact, he admitted as much!! Check it out:
Troller
I read something similar about this guy...that he sort of makes a living by trying to make waves with the latest trends. I think grain of salt is more than warranted. Even if the cell phone boon for Apple ends up being as short lived as he claims, Apple will still do very well with it.
-Le
I think this guy lives by the idea that the past always predicts the future. In many things this is true for cyclic type of events. But just as he had no way to fathom the idea that a mouse is useful in any way, he is missing that Apple is joining the cell phone market not to duplicate but to innovate. The capabilies of the iPhone are revolutionary. Plus it allows for Apple to change its features at any time. I don't know of any phone on the market that lets you do that. Apple is bringing something new and some are only shortsighted.
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