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iPod touch Apple needs to stop using the Sarbanes-Oxley Act as an excuse to charge its customers

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J

Jack Flash

macrumors 65816
Original poster
May 8, 2007
1,160
7
It's not about accounting, it's not about adding new features, it's about money and Apple needs to be upfront about it.

Yes, software costs money to develop. Yes, developers need to get paid. No, these software updates don't enable new hardware features and therefore don't have much of anything to do with the Sarbanes-Oxley Act.

How does Apple account for Safari updates? They certainly add new features to Mac computers that are already sold. How can Microsoft and Sony update their Zune and PSP systems with so many new features for free? I honestly don't believe accounting has anything to do with it.

When will Apple admit that they're selling firmware, without any requirement by the Sarbanes-Oxley Act?

Are these new features updates to what we have now? Yes. Are new applications and hardware functions being added through the 2.0 update? No.

- Push email
- Push calendar
- Push contacts
- Global address list
- Cisco IPsec VPN
- Certificates and Identities
- WPA2 / 802.1x
- Enforced security policies
- Device configuration
- Remote wipe
- Active Sync and Microsoft Exchange support
 
Tuta

Tuta

macrumors member
Dec 27, 2007
60
0
taken from the latest 10-q
For both Apple TV and iPhone, the Company indicated it may from time-to-time provide future unspecified features and additional software products free of charge to customers. Therefore, sales of Apple TV and iPhone handsets are recognized under subscription accounting in accordance with SOP No. 97-2. The Company recognizes the associated revenue and cost of goods sold on a straight-line basis over the currently estimated 24-month economic lives of these products with any loss recognized at the time of sale. Costs incurred by the Company for engineering, sales, marketing and warranty are expensed as incurred.
Click to expand...

ok, so this is purely apple trying to balance out their iPhone revenue stream --- in case it was a complete flop they would get to recognize the income over this estimate of 24 months, take all the costs up front -- if it sunk, they would slow production and tell the world that the iPhone was still profitable for them.

I would now like to ask Apple why they chose to account for the touch differently?

The development costs of the software are going to be, well, identical.

Other than the phone hardware and whatever is necessary to connect to EDGE in AT&T network, are there other big differences?

my brain at 10:50 is tired, but it seems to me that they chose this way to manage their exposure in case it failed.

they continue to charge the touch only because they said they wouldn't charge the iPhone users and apple must maintain this difference.

BUT -- hopefully they will be a little more forgiving on the cost for updates as it appears they have set themselves up with a solid potential revenue stream with the apps...

/crosses fingers
 
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