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Analyst Predicts Next-Generation iPhone Will Offer Lower Total Cost of Ownership

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Fortune reports on a new research note from prominent Morgan Stanley analyst Katy Huberty citing strong sales of Apple's iPad and the potential for increased growth in the iPhone segment from new models she predicts will carry lower total cost of ownership as drivers for Apple's stock price over the next several years.
In a report to clients issued Friday, Morgan Stanley's Katy Huberty offered one of her patented risk-reward snapshots of Apple (AAPL), this one even more optimistic than the last, thanks to what she sees as two new catalysts:

- The iPad launch in March. Huberty is anticipating unit sales of 6 million in calendar 2010, considerably higher than the Street's consensus of 3-4 million
- New iPhones in June. She's expecting new models that offer "both a lower total cost of ownership and new functionality, potentially including gesture-based technology"
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Huberty doesn't appear to have elaborated on the basis for her iPhone prediction or exactly what she means by "gesture-based technology", and it is unclear whether such cost of ownership savings would primarily come from the cost of the device itself or the much more significant monthly subscription pricing offered through Apple's partner carriers, as both have been cited as significant barriers to entry for customers.

As part of her analysis, Huberty offers three "bull scenarios" that see Apple's stock pricing surging to between $325 and $435 by fiscal year 2012 depending on the balance between subsidies paid to Apple by carriers and global market share. Huberty also offers tamer scenarios in which Apple's iPhone proves to show slower growth, and projecting stock prices in the $180-$250 range.

Article Link: Analyst Predicts Next-Generation iPhone Will Offer Lower Total Cost of Ownership
 
Article Link
https://www.macrumors.com/2010/02/26/analyst-predicts-next-generation-iphone-will-offer-lower-total-cost-of-ownership/
OMG the iPhone will have gesture-based technology!!? So we'll be able to like.. touch the screen and stuff!??? OH-EM-GEE!! I can't wait!!! I wonder if we'll be able to make calls with it too!?
 
I don't quite get this... Does this simply mean the iPhone may become cheaper in the future?
Not quite sure what "Lower Total Cost of Ownership" means, sorry if this is a stupid question.
 
I may not be very popular after I say this, but who the hell cares about the iPhone any longer. Did Apple stop making computers. Arn is this not directed at you sir, but Apple. The iphone has been done to death. So it may be a little faster, who cares?!? Bring out computers Apple! Bring out a better Apple TV, update the monitors, make us fall in love again with the pros. Give us something now instead of showing us a product and not release it for two months (iPad of course)
 
baryon said:
I don't quite get this... Does this simply mean the iPhone may become cheaper in the future?
Not quite sure what "Lower Total Cost of Ownership" means, sorry if this is a stupid question.
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This typically means there will be service options from the carrier(s) instead of "one-size-fits-all". I would bet on tiered data pricing.
 
bnerd said:
Why would they do that when iPhone users use wayyy more than $10 worth of bandwidth per month. That would be a loss to the company.
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Yeah, that doesn't make a lot of sense, but I wouldn't mind seeing more competitive, tiered plans, particularly for the carriers here in Canada.

A few early adopters signed onto a 6 gigs for $30/month plan, which is reasonable, although locked in at a 3-year contract. Current rates forr iPhone subscribers peg the data at about $30/month for 500 megs or 1 gig of data (depending on the carrier). You can get more data, if you want to pay more. All of this is on a 3-year contract.

I want to see something more competitive and with lower entry points, like 500 megs for $15/month, 1 gig for $20, 3 gigs for $30, etc. And lose the 3-year contract, as everyone else in the world is OK with 2-year contracts.

I've been sitting on the fence since the day the iPhone was released, and it is not the cost of the device (I'll happily pay $300-400 for an iPhone handset) it is entirely due to the cost of the data and that pesky 3-year contract in Canada.
 
solstix said:
Apple iPhone Next-Generation will probably be like this one :

Retweet please !!!
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Well, maybe it will be sort of like that, but as we know, the back can't be aluminum since it blocks radio waves. And knowing Apple, they will stick to the rounded corners. Also, I really doubt they could make it that thin all of a sudden. The front camera might be possible, but who knows!
 
goobot said:
analyst are always wrong about apple things. dont even pay attention.
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ESPECIALLY this one. Huberty is an idiot.

Of course, as a stockholder I hope she's right, but she was the one who was downgrading Apple when it was at ~$90/share last year.

So it actually worries me that now she's bullish on it.
 
baryon said:
Well, maybe it will be sort of like that, but as we know, the back can't be aluminum since it blocks radio waves. And knowing Apple, they will stick to the rounded corners. Also, I really doubt they could make it that thin all of a sudden. The front camera might be possible, but who knows!
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This is like iPad! 😀
 
akm3 said:
ESPECIALLY this one. Huberty is an idiot.

Of course, as a stockholder I hope she's right, but she was the one who was downgrading Apple when it was at ~$90/share last year.

So it actually worries me that now she's bullish on it.
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I don't know if Huberty is an idiot, but I think analysts are always wrong about apple things too 🙁
 
sbrhwkp3 said:
Why would anyone rate this negative?
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Why would anyone pay attention to the positive/negative ratings when they're completely meaningless and without context?

Anyway, I'm filling this away under analyst has no clue and is using technobabble to cover it up.
 
notjustjay said:
I want to see something more competitive and with lower entry points, like 500 megs for $15/month, 1 gig for $20, 3 gigs for $30, etc. And lose the 3-year contract, as everyone else in the world is OK with 2-year contracts.
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I just want to say I'm in the UK and would not sign a 2 year contract. Good deals on 18 months can be had if you haggle.

Currently I'm on a 12-month SIM only contract, £15/m for 300 mins and unlimited data/wifi. Also if I get the £100 cash back it would make this about £6.67/m!

It does mean buying a SIM-free iPhone though, with the 3GS 16GB costing £450 its a lot initial money, but it's cheaper and more flexible overall.
 
thecartoonguy said:
I may not be very popular after I say this, but who the hell cares about the iPhone any longer. Did Apple stop making computers. Arn is this not directed at you sir, but Apple. The iphone has been done to death. So it may be a little faster, who cares?!? Bring out computers Apple! Bring out a better Apple TV, update the monitors, make us fall in love again with the pros. Give us something now instead of showing us a product and not release it for two months (iPad of course)
Click to expand...

yes, why would Apple keep coming out with a new version of the most popular phone of all time, which happens to have captured a huge chunk of the smartphone market.

That would be CrAZy!!!!
 
Who makes a chart for 3 years with the time labels split into 5 segments? Not years, quarters, semi-annual. Nope. 7.2 months per period.

Rocketman

Here's the AAPL chart, marked up.
 

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Definition of a consultant: Someone you pay exorbitant amounts of money to so they can borrow your watch to tell you what time it is right now.

Definition of an analyst: Someone you pay exorbitant amounts of money to so they can borrow your watch to tell you what time it will be at some arbitrary point in the future.

...of course, that implies that an analyst could actually be right once in awhile.
 
What stock movement???

I have a hard time to see the effect of iPhone and iPod touch to make any difference in APPL stock price. It is hovering about $200 for many years now (before iPhone introduction). And we are on 3rd generation of iPhone and world wide now. Any investor would understand, Apple makes gadgets and it is not a necessity for everyone to have one or have many. Apple would be the worst performing stock in my portfolio at the moment. Loading up with GE at $5.94 and BAC for $2.56 was way more rewarding. No need to procrastinate on flat stocks, hey, APPL does not even pay dividends for their flat performing stock. Even PALM did 3-7x better then APPL last year.
 
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