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Photo: Associated Press
AAPL Up Strong As Market Rises
Expectations of a Senate vote to extend tax cuts are boosting stocks in early trading. Shares of AAPL are up a strong $4. Upcoming catalysts for Apple include monthly NPD data (Mac / iPod business); holiday iPhone and iPad sales updates and carrier expansion (Verizon); new content revenue streams such as video, books, newspapers and social (Ping); moving iTunes into the cloud; and the uptake of the new Apple TV. Shares of Apple trade at 15x Enterprise Value / Trailing Twelve Months Free Cash Flow (incl. long-term marketable securities).Apple To Fight For Nortel Patents To Take On Next Gen Wireless (Reuters)
Nortel, which controls some major patents on the next generation of wireless technology, is auctioning off the remainder of its patents to suitors like Research in Motion, Apple and Microsoft. Apple has already assembled a legal team to prepare for pending patent wars with Nokia, the company that controls more than half of the patents important to the development of the LTE 4G wireless network. Picking up Nortel’s patents would give Apple a bit of a better foundation in that fight. And we know money is no object.
Survey Shows iPad Users Likely To Kill Their Physical Newspaper Subscription (Missouri School of Journalism)
Many had hoped (mostly publications themselves) that the iPad would save journalism. As it turns out, the iPad could have a deleterious effect on print newspapers, with many iPad users being likely to axe their print subscriptions in favour of consuming news on their tablets according to a new survey of 1,600 iPad owners:
- 84% use the iPad to follow breaking news reports and current events as the most popular use for the device;
- 79% spend at least 30 minutes during a typical day consuming news on their iPad;
- 49% spend an hour or more during a typical day consuming news on their iPad;
- 58% who subscribe to printed newspapers and use their iPad at least an hour a day for news said they are very likely to cancel their print subscriptions within the next six months;
- 31% indicated that they do not subscribe to printed newspapers, with another 11% saying that they had already canceled their subscriptions to printed newspapers and switched to reading digital newspapers on their iPad;
Saving journalism by breaking a few eggs?
Apple MobileMe And Cloud Services Should Be Free To Lock Customers To Apple Hardware (GigaOM)
Apple sells the service for $99 per year, or $69 for the first year with the purchase of a Mac or qualifying iOS device. In comparison, Google offers free e-mail, data syncing, photo hosting, along with a free office suite, and free Android device location. By making MobileMe free, those using it with iOS devices won’t be using services from Google or Microsoft, which makes switching to Windows Phone 7 or Android more difficult. The point is lock-in. Get people using Apple’s free services with Apple’s highly profitable hardware, and they’ll be less likely to buy hardware from competitors.
Apple Wooing Enterprise Customers Under The Radar (Bloomberg Businessweek)
Apple reps are having hush hush talks with business IT departments. Why so shady? Because selling to corporate America isn’t the vibe Apple is going for. Apple makes consumer products. But when it comes to mobile sales, Apple gets a big assist from AT&T with thousands of reps helping corporate clients. And much of the renewed corporate interest in Apple is all about the iPad. How far will Apple go to woo business customers? The company has applied for a trademark on the phrase “Briefing Room,” a sign that they may become standard in larger Apple stores for enterprise customers.
Daily Trader: Hedge Funds Chase Apple, A Better Buy Than Microsoft (The Motley Fool)
Apple straddles the tablet, smartphone, computer, home-entertainment and media markets. So who’s buying it and how does it stand against Microsoft?
- David Einhorn made the media rounds this week promoting his stake in Apple talking up the “halo effect” associated with Apple products. After buying an iPhone, users tend to move on to Macs or iPads, creating a cycle of higher revenue and loyalty. He also believes the company is reasonably valued, citing a cheap multiple for such outsized growth.
- Microsoft isn’t as relevant as it was five years ago and the stock is essentially where it was a decade ago. That doesn’t bode well for the next 5 years. Apple, however, has been ascending. If innovation is the price that one has to pay to get consumers to pay a premium for their products, a position that Microsoft now finds itself in as it floats away in a sea of free alternatives that are growing in popularity, the safer stock bet is Apple.
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