What if the iPhone were an iPod?

ipod Newton anyone?

Let me start by saying to certain posters that I don’t understand what value is provided by the use of terms like ‘moron’ or ’stupid’. Take your aggression elsewhere. If you want to make a point go ahead and make it without such vitriol. If you’re so smart that you’ve done all the strategic and quantitative analysis about everything Apple under the sun, why are you looking at this news site?

But back to the subject at hand. I think that the Muller analysis is an extension of the GAAP vs. Non-GAAP accounting methodology for iPhone which hides the truly awesome financial power of this product away from, as Andy Zaky puts it, the seeming majority of analysts and others who don’t get it. Consider a scenario where Apple sells as many iPhones in each of the next 9 quarters as they did in their financial Q4/08. This was 6.9 million (you can argue about channel stuffing and whatever but let’s just assume that they can keep doing it). Also assume that Apple books $500 revenue for each iPhone. This is on the lower side of the $600 to $650 estimates that prevail.

Because of the multiplicative effect of the 8-quarter subscription revenue model, Apple would book $6.04 billion revenue in their 2009, and $12.94 billion revenue in their 2010.

Remarkable!

I have noting to say about the iPod today.

But I can say that Europe is US friendly again. And the dollar is strong so we expect to see you over here and on the slopes this winter.

Welcome back to the world, America. Good to see you again.

IMHO, the iPhone is only part iPod. It’s basically a computer that makes phone calls…and plays music, and a bunch of other cool stuff. The investor needs to realize that in a few years this iPod/iPhone could have a port for a keyboard and printer and run iWork. A handheld computer for $199. Hmmmmm…

Many analysts claim the iPhone is not an iPod, but I don’t see what they base this on. How can an iPhone eat into iPod sales when the iPhone is an iPod that makes telephone calls. Steve said it was an iPod. The problem is the name. It should never have been called an iPhone. It should have been called the iPodphone and then there wouldn’t have been this confusion.

I still don’t see how the iPod is sputtering towards the end of it’s life cycle. There should always be room for new iPods when the older one’s expire. An iPhone is not necessarily a substitute for an iPod.

Still, the only thing that should matter is the amount of money flowing into Apple’s coffers. If it flows in faster each year, does it really make a difference which product name is making it happen.

To jp,

If you’re an investor you need to recalibrate your estimate of what the iPhone is, really.

Simply put, if the other phones are ’smartphones’, the iPhone is a ‘geniusphone’: the 1st major (soon to be) dominant computing platform in 13 years.

PED, Your articles are great. I regret the abuse some have given you about “Of course, it’s an iPod.” This article is important because most investors don’t get this simple fact.

To JP, NY – The storm may be doing well in Europe, but it will have little effect on the iphone. You fail to realize that the iphone is based on an entire ecosystem, one in which its software, functionality and ease of use are unmatched across the spectrum of that ecosystem – desktop, laptop, phone, multimedia player, web access, iTunes integration, applications, etc. Further, the route to success for a brand is not FREE. That is what has so severely damaged so many other players in the market, especially Motorola. Furhter, as history shows us, Apple will continue to dramatically improve this offering through true innovation. RIM is a one trick pony.

Funny, all you people saying “moron” and “stupid” still read the article…. The hyper-information age will have redundancies within months or days that would have spanned years in the past. Redundancies can inform some people who haven’t caught the “first wave”. Get the stick out.

the ipod had no competition. the storm from blackberry which is being handed out for free in europe and will be available at a discount to the i pphone here from verizon is a very favorably reviewed formidable competition for the i phone which will eat into sales significantly.

I don’t know…. it seems like PED is becoming and Apple fan.

p.s. IMHO that is a good thing. ;-)

Yes, over at AFB at The Mac Observer last year I suggested that differentiating between the iPod and iPhone as product lines when it came to examing the relative growth rates of each was a mistake. The iPhone is and iPod is an iPhone is an iPod.

I wrote something similar last week too.

Glad to see others coming round to this idea.

What if it was an iPod ??????????

It is – Moron….Not kind of either

Didn’t we all come to this conclusion quite a while ago? I see that someone else has already covered the fact that it is an iPod.

I think that the GAAP accounting though will benefit Apple and shareholders as it pushes profits into recessionary quarters. And if investors can’t understand the math then they probably shouldn’t be in the market.

As I recall, Daniel Eran Dilger (or whatever other nom de plume he uses) at RoughlyDrafted.com asked and answered the same question, either late last year or early this year. His conclusion was that the growth of iPods + iPhones tracked the growth of iPods before the introduction of the iPhone. I.e., the iPhone is an iPod.

He also included graphs that made his point much easier to grasp, rather than just tables.

The iPhone is an iPod, STUPID.