Nikhil Kumar: Apple should turn on to TVs to show it still has what it takes after Jobs
There is uncertainty as investors struggle to make up their minds about the business
Nikhil Kumar is The Independent's New York correspondent. He was formerly assistant editor on the foreign desk and has also done a variety of jobs on the city desk, where he wrote about markets, commodities and other business and economics topics.
Tuesday 18 December 2012
US Outlook What's up with Apple? Or rather, what's down? The tech giant's shares have had a tough time of late, so much so that while Apple remains up over the year, you'd have been better off selling Apple and buying Nokia over the past month. Earlier this week, fresh headlines were generated when Apple shares (briefly) dipped below the $500 mark, a far cry from the levels of more than $700 apiece seen earlier this year.
A number of explanations have been put forth for this slide. Cool(er) guidance from analysts who were hitherto hot on the Californian giant is one. Another is the apparently less than exciting launch, by Apple standards anyway, of the iPhone 5 in China.
But neither stacks up. The vast majority of Wall Street's scribblers remain positive on the stock, and the launch wasn't in fact that bad. Though it's true that we didn't have the requisite images of Apple fans queuing round the block for the new gizmo, something that might have contributed to rumblings of low demand on Friday, official figures from the company on Sunday night confirmed it had shifted over 2 million new units in the first three days since it began selling the phone in the country.
Now, 2 million might not seem much in a country the size of China, but remember, the number of 3G subscribers remains relatively low at just over 200-odd million, so Apple, in fact, didn't fare badly. Certainly, there was nothing from China which would explain the share price weakness.
A more credible explanation is apparent failure of Tim Cook, who took as Apple's boss from the late Steve Jobs, to run a tight ship. The evidence for this is the recent maps fiasco, where the company which until not too long ago could do no wrong in the minds of investors and consumers had to admit that it got something very, very wrong.
The subsequent departure of Scott Forstall, the man who ran the iOS mobile software division, only heightened worries about Mr Cook's leadership. Mr Forstall, after all, was one of the big personalities whom Mr Jobs relied on to keep Apple ticking along.
But that alone couldn't be it. None of these concerns, or others such as those about the challenges facing the closed architecture of Apple's App Store amid a growing number of web-based mobile applications, is yet of such gravity as to dim the lure of the Apple brand, which remains strong, Mr Cook can still reassure the market. in fact, the share price weakness probably has to do with uncertainty as investors struggle to make up their minds about the business post-Steve Jobs. It's unclear if Apple can maintain its sparkle. Equally, though, it's not clear all is lost.
Which brings us to the (possible) solution. Accounts last week that Apple was testing televisions with its Asian suppliers might offer Mr Cook the perfect way to reclaim the initiative.
For there is no better way to prove that Apple's still got it, and that its shares still deserve the premium rating accorded by the market, than to lead the release of a new product line – one that would challenge the only company that is making any real inroads in the smartphones market, namely Samsung.
As the South Koreans take the fight to the iPhone with the Galaxy range of gizmos, Apple should take aim at their line of Smart TVs. The risks are high, with a number of players active in the field and Samsung armed with a well-recognised brand. But there are obvious areas that Apple could exploit. Think, for instance, of the possible benefits for developers and consumers of cross-platform apps that work across iPhones, iPads, Macs and TVs, against Samsung TV apps that work on, well, Samsung TVs.
By rising to the challenge and shepherding a new product line to market, Mr Cook could put an end to any lingering concerns among investors in a way that he cannot with incremental product launches such as, say, the iPad mini.
- 1 Reyhaneh Jabbari: Iran due to execute woman for murder of her alleged attempted rapist
- 2 Sainsbury's '50p challenge' poster telling staff to encourage customers to spend more placed in shop window instead of staff room
- 3 Expert urges cat lovers to own just one animal each
- 4 Car tax disc changes: Two days to go - and they affect you much more than just not displaying a piece of paper
- 5 The Simpsons death: Creator Al Jean would 'kill himself' before character like Homer or Lisa
Expert urges cat lovers to own just one animal each
Five-year-old Iris Grace is raising awareness of autism through her extraordinary paintings
Car tax disc changes: Two days to go - and they affect you much more than just not displaying a piece of paper
Isis an hour away from Baghdad - with no sign of Iraq army being able to make a successful counter-attack
British man raped while urinating in bushes at Oktoberfest beer festival in Germany
Isis, we are told, is a 'clear and dangerous threat to our way of life'. I’m sorry, but I just don’t buy it
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
'Women, walk wherever you want' posters taken down in Stamford Hill following 'unacceptable' signs separating men and women
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Mark Reckless becomes second Tory MP to defect to Ukip in a month
- < Previous
- Next >
iJobs Money & Business
£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...
NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...
£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...
Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...