Got a tip for us?
Let us know
Become a MacRumors Supporter for $50/year with no ads, ability to filter front page stories, and private forums.
Apple Q3 Conference Call Results
- Thread starter MacRumors
- Start date
- Sort by reaction score
iMeowbot said:
Actually, I don't totally disagree with you. In fact, I agree that it was Michael "The Diesel" Spindler that probably damaged Apple the most. I was perhaps too harsh with Amelio, as he was brought in as a turnaround artist to reverse Apple's declining fortunes.
But while Amelio had a lot of good intentions, he just didn't execute. The MacOS absolutely stagnated under his watch, and it got so bad that Apple had to go shopping to buy a new OS. Ironically, it was Amelio who was responsible for Apple making the decision to buy NeXT, and without NeXT technology and talent, Apple would probably be dead and buried by now, and there would be no Mac OS X.
Amelio was, in my opinion, a case of good intentions gone awry. Anyone remember his opera-length, rambling keynote from MacWorld? It was like watching the coach desperately trying in vain to pep up his football team, which is down by 54 points with just 2 minutes left in the game. I think everyone was weirded out by that deperate spectacle.
Whatever faults Jobs may have as a manager and leader, even his critics have to admit that he is very effective at what he does. Jobs is the one who coined the phrase "real artists ship" way back when, and under Amelio, Apple just wasn't shipping anything worth buying. Sure, it takes time to turn a $10 billion sinking boat around, but hey, after Jobs came back, he immediately chucked deadend programs left and right (like the Newton) and created a crash development program to produce the iMac from scratch in about a year (and we know how much an impact the original bondi iMac had in turning around Apple's fortunes). The iMac wasn't just about creating a cool iconic computer that would get people to start buying again, it was as much a challenge issued by Jobs to have Apple prove to ITSELF that it still had what it took.
Heck, even the iPod took, what, just 6 months to develop from conception to shipping (even if Apple had to license certain technologies)! In the entire 25 year history of Apple, Jobs has been the only leader who has managed to squeeze that much creativity and productivity out of Apple engineers, on a consistent basis. It's no wonder that he inspires the loyalty and confidence that he does.
dongmin said:
Good point.
One thing that should be clarified. It may be $0.99 per song, but it's $9.99 per album. Albums typically have 12-18 songs, so the cost per song can be as low as $0.55.
Apple says that about 40% of iTMS sales are actually album sales, so for every 100 songs sold, about 40 of them were from whole album sales. Doing some rough calculations:
40 album song is =~ 3 albums = 3 * $9.99 = $29.97 in revenue
60 single song downloads = 60 * 0.99 = $59.40 in revenue
so roughly, Apple pulls in about $89.37 in revenue for every 100 songs sold, NOT $99.00.
So if Apple sold 30 million songs during the quarter, we can estimate that songs contributed only $26.81 million in revenue.
So where did the other $46 million come from?
As dongmin suggested, a lot could have been from gift cards and allowances. Audio books were also mentioned, and there are a lot of books that cost $20 or more. Someone suggested payola, but I think Jobs is too smart for that.
In fact, during one conference call, he derided payola specifically when it was brought up by as a question by essentially saying, "Look at our track record. Have we ever sold anything on the Mac desktop? Look at what our Windows competitors have done" [referring to the standard practice of PC companies littering the Windows desktop with icons in exchange for payment]
In fact, taking payola would undermine Apple's bargaining power with the labels greatly so early in the game. Apple would, more or less, be the music industry's bitch by taking bribes before the service has matured. By not taking payola and growing iTMS on its own merits, Apple ends up wielding a huge amount of power over the labels. I suspect the labels are simultaneously salivating with greed and quaking in their boots because of iTMS - salivating because they get more royalties per song sold via iTMS than via CD (Jobs stated as much in public), but quaking in their boots at the notion that within a few years, iTMS could actually be 10% of ALL legitimate music sales worldwide, and unlike CDs, Apple controls the distribution system 100%.
Anyway, I suspect books are a big contributor - the first quarter Audible was integrated into iTMS, Jobs stated Apple had sold more than 50,000. If you assume an average price (this is a total guess) of $15, that's $7.5 million right there. By now, maybe Apple is selling 100,000 Audible books per quarter, which could add up to $15 million in revenue.
The rest might be unspent allowance or pre-paid iTunes cards sold at Target.
Still, $73 million in revenue for iTMS is pretty damn impressive. It's hard to believe the service is a little more than a year old!
frankly said:
Not at all. I was trying to address the misconception floating around that since Apple reported $61 million in profit on $2 billion revenue, that its "profit margin" was a measly 3%.
Apple clearly makes way more than 3% on a dual 2.5 GHz PowerMac G5, just as it clearly makes a lot more than 3% profit even on a low-cost eMac. It seems to me that people were confusing net profit with gross margins, and that's what I meant by referring to the "real" profit Apple makes on an iBook, PowerBook, or iPod, i.e. Apple makes plenty of profit from each Mac sold.
dongmin said:
The iMac also appeals to those who consider that buying a PowerMac and a seperate screen are too expensive, but don't want to be cramped on a laptop. Really, the screen and the machine are good value when taken together. Not the fastest machine, but then if you were in the market for speed, you'd be plonking down your money for a PowerMac, wouldn't you. And everything Apple makes is stylish.
All I can say is that if this new iMac does not have an upgradable video card I am not buying, I am not going to get burned again by a video card that can't be upgraded, playing games on a 700mhz G3 iMac is a pain to say the least. Come on Apple please make the new iMac at least semi expandable, give it an upgradable video card, and at least 1 free PCI slot.
Macmaniac said:
BUY A BLOODY XBOX! I love my iMac g4, 17"... it has helped me generate at least £4,000 this year freelancing, kept me in touch with my friends, it found me my WIFE, it looks stylish, it holds all my tunes, its got a gorgeous flat panel screen, it never crashes!
BUT it runs ALL games pants. any game you throw at it. It can barely run SOF2 at 640x480 with everything turned down... but thats why i've got a BIG ****-OFF PC rammed full of ram and a ATI radeon 9800 pro... Macs are not specifically aimed at games players.. although I agree that this needs to be sorted out in the future for Apple's market share to increase.. but the new iMac should still be an all in one, wonder machine. No bloody PCI bull****!
I'm sure that G5 Powermacs would run all the latest games very well, don't get me wrong, and this is probably going to bode well for Mac gamers in the future, but at the moment, if you're big into games and want a **** load of choice, get a pc and quit expecting the new g5 to have a headless body, pci slots, and a radeon 9800 pro as standard.
Fair enough
this is really the first time I remember Apple giving out information about new products before they're released. but I guess it's better in this case because now people are mad because there's no imacs available "HEY WHAT'S TAKING SO LONG.. DON'T MAKE YOUR DADDY GIVE YOU A LESSON, BOY!". telling them it'll take some more time because they're getting much more powerful computers they'll be nice and wait.
this is really the first time I remember Apple giving out information about new products before they're released. but I guess it's better in this case because now people are mad because there's no imacs available "HEY WHAT'S TAKING SO LONG.. DON'T MAKE YOUR DADDY GIVE YOU A LESSON, BOY!". telling them it'll take some more time because they're getting much more powerful computers they'll be nice and wait.
%
Does anybody have an idea or has there been any recent calculations on how much market share Apple has now after a healthy quarter? 3%>>
Does anybody have an idea or has there been any recent calculations on how much market share Apple has now after a healthy quarter? 3%>>
tmornini said:
Microsoft manufactures/sells software, which once you make one copy, is pretty easy to replicate and sell. Apple sells hardware, the bulk of which is manufacture by other companies, and develops software for them for nothing. (with the exception of Final Cut, etc.)
Dell or Gateway would be more comparable by % of profit from revenue, but they don't produce their own OS.
I just wanna clarify something here.. Microsoft DO make hardware. Sure they're only peripherals, but it's hardware all the same.
And personally... I reckon they're better at hardware than software. It's kinda ironic really... I trust MS hardware 100%. Yet I could never trust their software!
And personally... I reckon they're better at hardware than software. It's kinda ironic really... I trust MS hardware 100%. Yet I could never trust their software!
djdarlek said:
Consoles suck. High priced games compared to PC.
Playing 3rd person shooter games using a controller is a no go for me, at least.
Keyboard + mouse.
As for apple profit.
I'd rather see apple plough $$$$$$$ into R&D rather than Apple producing larger profits. Without a large R&D budget, apple cannot keep on producing high quality goods for us to all to drool over ( OR whine at
).
Macrumors said:
Surely the iMac wouldn't go G5 before the Powerbook?!
Paris might be a big launch after all. Heh heh heh.
ChrisH3677 said:
i'll admit, i was one of those. at that price point, i didn't think there was any way that they would sell as well as they have. i figured there would be an initial spike for the new!cool! factor, but then people would lose interest. Apple can't keep the things on the shelf.
that's why i'm a designer and not the person making decisions...
gotohamish said:
Of course it will. The re-engineergin efforts required to shoehorn the G5 into a laptop and keep it cool are far greater and more complicated than putting a G5 in an iMac. There are still great challenges around putting the G5 in the iMac as well, but not nearly as much as putting a hot server-class chip like that into a portable machine and not melting the user's lap.
I agree with you. Although I wouldnt want to be found dead anywhere near a Windows PCChrisH3677 said:I just wanna clarify something here.. Microsoft DO make hardware. Sure they're only peripherals, but it's hardware all the same.
And personally... I reckon they're better at hardware than software. It's kinda ironic really... I trust MS hardware 100%. Yet I could never trust their software!
I have to admit I quite like my Xbox. (yes I know it sounds bad ) But frankly I don't see why anyone still borders with playing games on a PC (or Mac) because your PC will be almost outdated the moment you buy it. You have to practically update your computer every year to play the most recent games at an acceptable level. At the same time you can buy something like a Xbox at half the price and use it for years with all new releases playing great (and still getting better too). It even can be used as a reasonable DVD player as well. It plays dual-layer DVDs without any interruption when the next layer is accessed (unlike many hardware DVD players).Still when it comes to using serious (pro)software, It's Mac-only for me. I find using Windows an extremely inefficient and annoying event.
ChrisH3677 said:It's kinda ironic really... I trust MS hardware 100%. Yet I could never trust their software!
right there with you. i LOVE M$ mice and i've bought quite a few (thanks to steve's insanely bullheaded notion that we only have one finger with which to operate a computer). you KNOW at this point the only reason they don't release a 2/3/4/5 button mouse is that steve would have to admit he should have done it years ago.
i'm sorry to go off on a rant here, but i just CAN'T GET OVER the fact that he thinks it's a "failure of software design" to need more than one button on a mouse (i was there when he said that exact quote). that's like saying, "well, that keyboard should only have one key. why on earth would you need more than that??!?" it's an INPUT DEVICE, steve. let me INPUT more than a 'click'. oooooo, or maybe a DOUBLE-click. as far as that goes, is it a failure of software design to need to click something TWICE?
steve, i'm glad apple turned a profit, the mini's sales kick butt much to my surprise, but please, please get over this notion that we only need to control our dual-processor-liquid-cooled-gigabyte-RAM-wi-fi-aluminum BEAST with one paltry button.
vitaboy said:
That would be $1.5 million.
It would be interesting to know just how many book sales there were last quarter. I'm guessing it was higher than normal due to the Clinton book and the David Sedaris book (the latter is currently selling more than the former), both of which came out last quarter.
Also, the european iTMS also sell audiobooks, although just as with music what's available varies by country, e.g. the Sedaris and Clinton books are available in France and Germany, but not in the UK -- it's probably trickier getting the rights for the UK since US books often have UK publishers. Not a big market for publishing books in English in non english speaking countries.
Interestingly, the German store has a few German language titles.
nagromme said:
If I had the choice between $2000 20" all in one iMac or $1000 cube + $1000 LCD I would definitly go for the cube. Even if the all in one iMac looks cooler. And so would many many people including many many switchers. I would prefer buying every 2 years a new cube instead of every 4 years a new iMac.
Das Lied von der Erde
A song is a poor unit of measurement. How many "songs" are there in Beethoven or Mahler's 9th Symphony?
I know that pop music is iTunes' best seller, but it's not the only thing they sell. I buy audiobooks, opera, and symphonies, which tend to be more expensive and less easily divided into neat three minute Clear-Channel chunks.
vitaboy said:
A song is a poor unit of measurement. How many "songs" are there in Beethoven or Mahler's 9th Symphony?
I know that pop music is iTunes' best seller, but it's not the only thing they sell. I buy audiobooks, opera, and symphonies, which tend to be more expensive and less easily divided into neat three minute Clear-Channel chunks.