This is going to be a really big year for Apple.It’s set up to totally overhaul its iPhone line, introduce a television set for the first time ever, and perhaps most importantly, try to stay on top without Steve Jobs running the show.
We’re diving into the biggest of big questions floating over Apple for the year.
As more time passes without Steve Jobs at the helm of Apple, will the company maintain its magical aura? Tim Cook is nowhere near as inspiring or original as Jobs. Sure, he can keep the company moving in the right direction, but can he maintain the company's mystique? Will people still love Apple and its products in the same rabid way? Does it matter?
This is the biggie. There's been a lot of hype around Apple releasing a TV this year. Will it actually happen?
An Apple television is useless if doesn't have great content on it. Sure, Apple could just have cable running in to it, but what's the fun of that? How is that revolutionary? It is reportedly trying to get content from top tier networks to offer some sort of disruptive TV service. Naturally, content companies like ABC, NBC, ESPN, and others aren't ready to throw their lot in with Apple. Can Apple change their minds?
Apple will have two years on Verizon plus a year on Sprint. Will it have any impact on Apple's flat market share in the U.S.? Or will Android continue to take over the market?
Apple is doing pretty darn well with a minor share of the smartphone market. It's still attracting the best developers. It's still coining money. Does any of that change in 2012 if Android continues its ascent?
Apple has a very clear strategy with the iPhone. Release a new one every year. Take the old one and demote its standing in the line up, making it cheaper. Does Apple need to mix it up? Does Apple need to introduce a cheap, pre-paid phone to compete in markets that can't afford a top of the line iPhone? What about an iPhone with a bigger screen? Android users seem to love them. Will Apple release a 4' iPhone?
Apple is expected to roll out a third model of the iPad this year. Will it be good enough to keep Apple in the lead of the tablet market? Or will Amazon make a run at the iPad with an expanded Kindle Fire lineup? What about Google? At some point it has to make a decent tablet, right? Will Microsoft do anything this year?
Maybe the better question is, how much will Apple cut the price of the iPad 2? And will it only cut the price of the iPad 2? At this point, a lot of smart people think Apple is going to keep the iPad 2 in production when it releases the iPad 3. It will follow its iPhone model and reduce the price of the iPad 2. But, will it cut the price to $400? Or will it go crazy and cut it down to $300? If it's just $300, how much money can Apple make off the iPad 2?
This is a really big one that few people seem to talk about: What does the tablet market look like? Do people replace PCs with tablets? Or are they bought alongside PCs? If its the second, how big is that market right now? How many people can really afford tablets?
There seems to be a quiet assumption that the iPad will be a blockbuster seller like the iPhone. But, so far it isn't. Apple is expected to sell 13 million iPads in the holiday quarter. That's great, but it's no iPhone. And this leads to our next set of questions: Is it like the PC market and people upgrade every so often? Or is it like the smartphone market and people upgrade every two years?
The tablet market is brand new, and hugely important to Apple's future. How it continues to evolve will be something to watch this year.
Apple grew revenue 66% in fiscal 2011, and 52% in fiscal 2010. EPS was up 83% in Fiscal 2011, and up 67% in Fiscal 2010. Apple axe Gene Munster is forecasting 28% sales growth and 24% EPS growth for fiscal 2012. Is he going to be totally wrong? Will Apple be able to continue to delivering mind blowing growth?
One reason Apple has been able to hold onto top executives is that the company's compensation packages are built around a stock that has grown by 4X in the last three years. Odds are that Apple's stock will not be trading at $1,600 in 2015. Will this affect executive turnover?
What happens to the stock this year? Any number of armchair analysts will tell you Apple's PE is incredibly low on a relative basis. Will that lift up? Or will Apple bulls continue to be confounded by stock's relatively tepid growth?
This is one of those boring stories that just won't die. Apple will have over $100 billion in cash on hand by the end of the year. That's just absurd. Will Apple buy back shares? Issue a dividend? Hand out an iPhone to every American to crush Android's growing market share? Let the employee of the month swim through the cash in a giant vault like Scrooge McDuck? Make a giant acquisition? Buy smaller companies and continue to invest in its supply chain, which gives it a bigger advantage over rivals than any of the other ideas we just listed?