Time to Buy Apple Stock?

In February of 2012 I wrote a blog post called Chocolate Cheesecake, Apple’s Flat Panel TV and Steve Jobs. The post was my way of processing sadness over the loss of this wonderful man, who had made a huge difference in my life. I predicted iTV was coming and even described how it would work. At the same time I questioned if Apple could continue to innovate without the vision of Steve Jobs. I pointed out some things I was seeing in the updates to the Macintosh OS that worried me.

“I really wonder now that Jobs is gone how will Apple fair at this magical process? With no one like Steve to say “its crap start over” what will happen to new products being developed?”

So now, a year later (mid April 2013), can the question be answered with anymore clarity?

Based on the precipitous drop in Apple’s stock price from the $700 range to under $400 it would seem that Wall Street has lost faith in Apple’s ability to continue to alter the landscape they owned in 2012. Why? There are probably two major reasons.

Market Share. Apple has felt the power of Samsung and the Android OS developed by Google. Even though they are not as well constructed as the iPhone and iPad, Samsung offers a greater range of cell phones at all prices including low cost. In smartphones Android has more international market share than Apple while Apple still dominates the tablet marketplace. It’s not like Apple has stood still, over the last year they have developed several new models of the classic iPad (smaller screens, more resolution, more memory) but these are all evolutionary incremental changes, not the revolutionary changes that sprung from the brilliant mind of Steve. Rumors abound of the iTV, a low cost iPhone and most recently a iPod-screened wrist watch encased in a glass bracelet. Since these products have remained rumors a good deal of confidence in Apple’s fulfilling Steve’s dreams has been lost.

Perseverance. It’s too early to write Apple’s epitaph. Steve left us only a year and a half ago on October 11, 2011. While that might seem like a long time in the world of computer tech, I don’t think it’s long enough to design and test a product of the scale of Apple’s past innovations. Steve first hinted at the iPhone in 2003, and it was not ready until January of 2007. That is 4 years! So assume by “cracked the code” Steve meant that in 2011 he had an iTV design he felt could be successful. Then using the same math as the iPhone, it stands to reason we would not see an iTV until 2015, over 2 years from now. Add to this the fact that Jonathan Ive, the industrial designer responsible for all of Apple’s case designs, is now heading up the software division and you’ve added more potential delays. Couple that with the loss of iOS visionary Scott Forstall plus the fact Tim Cook runs Apple by consensus instead of conflict, and it’s easy to tack on another year of delays, taking the iTV to at least 2016.

Steve was only able to focus on a single revolutionary product at a time. Indeed he often pulled engineers off existing projects to make sure to make sure whatever was his favorite product got the priority he wanted. Thus to assume Apple is working on multiple revolutionary products, such as an iPad based watch or radial digital glasses seems unlikely to me.

The Broadcast and Cable Establishments

There is one major wrinkle in iTV’s future. The Broadcast and Cable Establishment. The term Broadcast Establishment was coined by Ted Turner when he took on the television networks during the Regan era, when the White House would not share it’s video’s with anyone but the big 3 networks. Ted showed you could beat the establishment when he created CNN’s  24 hour television and changed the model itself. But for Apple it’s way more difficult now. The nemesis is the way the networks and cable industry have locked down the commercial models distribution of television in America. There is not enough room on our the drives of our SQL server to discuss this issue in proper detail. But you can find some amazing articles online that describe why the networks and cable companies don’t want to see Apple gain a foothold in television like they have done to the music industry with the iPod and iTunes. Without the iPod there would never have been iTunes and without Jobs getting the music industry to agree to selling 99 cent tracks there would have never been the revolution in music we now enjoy. Apparently Steve Jobs has been  unsuccessful in getting his reality distortion field to hypnotize the Broadcast and Cable Establishment.

Here’s what Forrester’s James McQuivey had to say on his blog :

“Let’s be clear what the company is up against in its long-rumored interest in the TV business. The reason it has failed with the Apple TV so far is not that it hasn’t tried. It’s that the TV business is a tough nut to crack: Content is still controlled by monopolists unlikely to give Apple the keys to their content archives. And simply introducing a new display on which to watch that content as it is currently delivered by existing distributors won’t offer consumers much that’s new.”

The basic concept here is that Apple will never be able to strike deals with content providers sufficient to support an iTunes for television. And if all Apple plans to do is improve its current Apple TV set-top box, which means steaming content through television set, it will not have a compelling offering.

Time to buy Apple Stock

So with all this going against Apple it’s my opinion that Tim Cook will strike a deal with the broadcast networks. The price of Apple’s stock was run up to unrealistic levels and it has similarly been unrealistically beaten down. Indeed if we are 2 to 3 years away from an i-television you can wait to buy a while longer. However given the fact that the iPhone is due for a major hardware update, and June 2013 is the most likely time such a product would be launched, I would not be surprised to see Apple’s stock jump from its current under $400 price to as high as $500, before dropping again. It won’t be until we see the iTV, digital watch or i-Glasses that the stock will return to its highs of 2012.

In Memory of Steve Jobs

The following article was posted by Nigel Hall, President, Appweavers, Inc. on October 6, 2011, not long after Steve Jobs passed away. Nigel is the developer of Peterson Birds of North AmericaNigel worked with me in the early half of 2010 and went on to develop the Peterson app for the iPhone. He blogged what I believe is a beautiful tribute to Steve Jobs. It shows how much further Steve’s genius reached than simply the world of digital electronics. See if you agree.

In Memory of Steve Jobs by Nigel Hall

I suspect everyone who has used an Apple product over the past few years will be touched by the death of Steve Jobs, but for those of us who’ve had the pleasure of working with Apple devices day-in-day-out, it’s especially affecting. The outpuring of condolences and memories on Twitter and blogs across the Internet and across the world is something you don’t see everyday. Steve Jobs found a way to touch many people’s lives, but I want to focus on the way he has specifically touched birders.

A few years ago I had the privelege of working alongside Mitch Waite, developer of the iBird apps. Mitch and Steve Jobs’ lives have curiously intersected in different ways over the years, but if it wasn’t for Steve, there would be no iBird. And if it wasn’t for iBird, there’s a good chance you might not be walking around with an electronic bird guide in your pocket.

The first incarnation of iBird was called Winged Explorer and Mitch developed it for Windows Mobile computers. It was something of a hobby, but an inordinately expensive one. And it failed miserably. People didn’t take to Windows Mobile and very few copies of Winged Explorer were sold.

Enter the iPhone.

As soon as the iPhone hit retail stores, Mitch started to get requests from birders to rewrite Winged Explorer as an iPhone app. Having spent several years and untold amounts of money developing the app for Windows, Mitch was in no mood to go off and spend more money converting the software to work on an untried device. But, birders persisted in calling him and he eventually relented.

iBird Explorer took off like a rocket and was used by Apple in their early iPhone TV ads. Apple liked iBird because it was a perfect example of the kind of innovative new application that the iPhone made possible.

It’s fair to say that if iBird Explorer had not been rewritten to run on the iPhone, birders would not have the amazing choice of apps that they have today. Publishers of paper field guides, like Peterson, Sibley, Audubon, and National Geographic, have always resisted technology and it’s difficult to imagine them taking the risk to invest in putting their works out as apps, had iBird not lead the way and shown that it could be done. And iBird would never have happened if it wasn’t for Steve Jobs and the iPhone.

So, whether you use one of Apple’s mobile devices or an Android or Blackberry phone, if you’re a birder, give a moments thought to Steve Jobs and his remarkable acheivments. He changed birding.

Nigel Hall

Hello iBirders!

I’m happy to welcome you to our new iBird Blog.  The idea for this blog came out of my frustration. Let me explain. First in case you’ve been sleeping under a rock (some birders I know actually sleep in what I bet you would agree is a cave) a “blog” is a way for a blogger (that would be me in this case) to write about stuff, publish it on the web, and have people leave comments about that stuff. So maybe now you can guess my frustration came from not having a good way to talk with our iBird customers. Its my hope this blog will allow me to communicate all kinds of interesting topics about iBird including:

  • Cool things we are working on for future updates to iBird
  • Answers important to all iBird customers
  • New technology in birding, what I call “naturetech”
  • The best places to bird, the best birding books to read, etc.
  • What to do if you get a ticket for J-walking

Okay that last bullet was not serious but I want to make sure you are reading this, otherwise what’s the point?

I’ll publish this message to the blog and ask you all to leave comments. To give some direction to the comments, here are some of the things I would like to hear from you:

  • Is this blog a good idea?
  • What would you like me to post on the blog?
  • What do you love and hate about iBird (when I say hate I mean it tongue in cheek; I will delete hate mail but I do want to know what you don’t like as well as what you do like.)

Thanks for taking the time to read this and hopefully leave some thoughts.

Mitchell Waite
Publisher, Mitch Waite Group