Apple (AAPL) Discusses Carrier Subsidies, HTML5, Samsung, iCloud, and Enterprise
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Up: 10 | Down: 10 | New: 19
Rating Summary:
52 Buy, 12 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 10 | Down: 10 | New: 19
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Sterne Agee's Shaw Wu talked Apple (NASDAQ: AAPL) today following a meeting with CFO, Peter Oppenheimer, and SVP-Internet Software and Services, Eddy Cue, focusing on frequently asked investor questions around carrier subsidies, HTML5, Samsung, iCloud, and enterprise. Wu said he walked away with no change to his upbeat view.
On carrier subsides, Wu notes that Apple iPhone provides a lot of value to carriers with the industry's lowest churn rate of under 2%, efficiency with data, and propensity to drive family plans which have higher RPU. "A $400 subsidy is relatively minor when a carrier is able to collect $1920 in revenue over a 2 year period when signing up a customer to a typical voice+data monthly plan for $80 that it otherwise may not acquire," Wu comments. He believes concerns are overblown.
On HTML 5, Apple said it is big supporter of the technology with Steve Jobs familsu supporting the technolgy over Adobe flasth. "Management believes that the need for native apps will exist as one simply cannot do the same things with a browser as they can with native apps. We want to remind investors that before the advent of the App Store in July 2008, there were web apps that were clunky and inefficient. App developers pushed for native apps that are efficient and optimized and that's why the iOS SDK was made."
On the Samsung relationship, management commented that it is both a "pain" as a competitor but "works well" as a supplier. "This is obviously not an ideal situation but it appears that both companies are making do for the foreseeable future," Wu comment.
On iCloud, the company views it as key part of its strategy along with its core ownership of operating systems and ability to run native apps that make it a very tough competitor, Wu notes. Management said a lot of customers use it without knowing it because no training is required and it is seamless and just works.
On the enterprise market, management said it is adding to its sales team, spending on its VAR network, adding briefing rooms in its retail stores, and adding service capability. That said, the company is not making custom models for enterprise, instead they will be offered the same models as customers.
The firm maintained a Buy rating and price target of $780.
For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.
Shares of Apple closed at $571.46 yesterday, with a 52 week range of $310.50-$644.00.
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On carrier subsides, Wu notes that Apple iPhone provides a lot of value to carriers with the industry's lowest churn rate of under 2%, efficiency with data, and propensity to drive family plans which have higher RPU. "A $400 subsidy is relatively minor when a carrier is able to collect $1920 in revenue over a 2 year period when signing up a customer to a typical voice+data monthly plan for $80 that it otherwise may not acquire," Wu comments. He believes concerns are overblown.
On HTML 5, Apple said it is big supporter of the technology with Steve Jobs familsu supporting the technolgy over Adobe flasth. "Management believes that the need for native apps will exist as one simply cannot do the same things with a browser as they can with native apps. We want to remind investors that before the advent of the App Store in July 2008, there were web apps that were clunky and inefficient. App developers pushed for native apps that are efficient and optimized and that's why the iOS SDK was made."
On the Samsung relationship, management commented that it is both a "pain" as a competitor but "works well" as a supplier. "This is obviously not an ideal situation but it appears that both companies are making do for the foreseeable future," Wu comment.
On iCloud, the company views it as key part of its strategy along with its core ownership of operating systems and ability to run native apps that make it a very tough competitor, Wu notes. Management said a lot of customers use it without knowing it because no training is required and it is seamless and just works.
On the enterprise market, management said it is adding to its sales team, spending on its VAR network, adding briefing rooms in its retail stores, and adding service capability. That said, the company is not making custom models for enterprise, instead they will be offered the same models as customers.
The firm maintained a Buy rating and price target of $780.
For an analyst ratings summary and ratings history on Apple click here. For more ratings news on Apple click here.
Shares of Apple closed at $571.46 yesterday, with a 52 week range of $310.50-$644.00.
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