01/30/2008, 11:05am, EST
Wednesday, January 30th
Street: Apple has hard road to 10 million iPhones
Apple may have a difficult time reaching its 2008 sales goal of 10 million iPhones, says market publication The Street. The publication notes that while Apple has sold over four million iPhones to date, to reach 10 million by the end of this year, it will have to average 2.5 million phones per quarter, which is 200,000 more than what was sold during the last, holiday-driven December quarter. The company is also facing a number of financial obstacles, internal and external.
The latter may be the most significant, as a $400 smartphone, ignoring accessories or monthly fees, may now be too expensive for some due to a failing US economy. Over a quarter of American iPhones are now also said to be unlocked, which may continue to provide some income to Apple, but deprives the company of the 10 percent in monthly fees it receives from AT&T.
To reach the 10 million mark, some analysts suggest that Apple may need to make some significant shifts in its iPhone plans. Ezra Gottheil of Technology Business Research, for example, argues that Apple may already be planning to cut $50 off the 8GB iPhone by the middle of the year. When Apple dropped the price by $200 in September, sales rose 20 to 25 percent. "There is room in the iPhone margin to cut price now," Gottheil says.
Analyst Mike Abramsky of RBC Capital contends that instead, Apple will likely introduce new models, and/or upgrade the existing phone. 3G is guaranteed at some point this year, but Apple could also decide to introduce components such as a built-in GPS receiver, according to Abramsky.
Regardless of the average sales it has to meet, Gottheil says Apple is determined. "The number is a challenge, but unless the global economy slows down profoundly, Apple will make it happen."
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They'll intro a new iPhone about mid-year and cut prices on 1st gen iPhones.
Will they make 10 million? It will be close but I think they'll do it.
Additionally, Apple makes such good money on the contract, that they can afford to (if needed) drop the price $50 or $100 on the phone to increase sales. I'm sure they will probably do that anyway once the 3G version intros later this year.
Jeesh. These people deal with numbers all day. You think they could get something as simple as this right.
I utilize near 1200 minutes a month on regular time on My-Faves, that's ridiculous to give up just to sport an iphone.
So if analysts are thinking Apple said 10 mil in 2008, the price of the stock was adjusted accordingly, and, as such, concerns over that would re-adjust it accordingly.
Plus, by now, they've pretty much learned not to pay attention to Apple's own expectation numbers, for they've proven to live by releasing low expectations so they can 'blow past them' when releasing actual numbers. You can do this once or twice, but then they catch on. That's why the analysts expectations, let alone the whisper numbers, are always higher.
So when Apple says "We expect to sell 10 million by end of 2008", the analysts will then just add on the usual Apple low-ball percentage, and come back to actually expect 14 million sold.
Glad you're thinking strictly about yourself in saying at&t is the real problem. So, strait across the board Tmobile is $80 a month cheaper, I'm calling bulls*%# on that. Plus, how about us that have all of our friends and family on at&t, so all of our calls are free to them on at&t with our iPhones? Don't be such a singular minded ass and call a phone carrier the problem just because it might not work best for your situation.
I had Tmobile and had to stand in one spot at my house to get any signal and it didn't work at all at my lake place. I didn't bitch and say that Tmobile was the worst thing on the planet, I just found a carrier that worked for me and to my joy and excitement they were the carrier of the iPhone.
But thanks for the book report on how much you call your "Faves" that makes my day so much more worthwhile now.
I love the iPhone, but my problem with it is that it's a phone. No problem - an iPod Touch ought to do nicely. And no one will call me on it - yay!