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iPod Is Doomed

iPot is a tiny experiment

I work consolidating web sites and a lot of it involves marketing so.

What may be happening is that the iPod is wearing the wrong suit. There should be a better concept for the same machine. Not to be sold as a MP3 player because can do better things like that. You can program it, can load lts of things in to it. It is better than a Jazz drive may be, but is not compatible with the non apple computers in the marke.

the Cube was a expensive computer to build and it was a hudge investment. The iPod is not that expensive and is an accesory, so I do not think Apple is loosing a lot of money with it.

There should be a secund generation iPot soon with some new features better than a color LCD if this one survived.
 
vs cube

if the ipod falls, it certainly couldn't have cost as much as the cube

but i don't recall the last time, if ever, when apple put out a non-computer product so this is a big step and certainly not the only attempt at a peripheral in the digital hub, of which the pc world has used since '98 with good success

the rio started out super strong but diminished somewhat after that but digital cameras have been getting more and more numerous and affordable
 
re: huh

the iPod alone cannot kill apple and turn people off, that i totally agree with

by saying apple has "bags of cash" is a ridiculous myth that i often hear people (mostly techies with no businesss knowledge) spout about any company they like because of some product they think is hot...webvan had bags of cash but they died, shawn fanning had bags of cash but his company went down, the founders of cisco are rich but that alone did not keep cisco over 100 a share

the share value of a company is what they need for survival and the cash recerves is not what one should rely on, they need that for r and d, not day to day operations

do you buy groceries with you roth ira, do you pay rent with a cd?

have you looked at the wall street jounal recently?

apple needs a boost and it will take all they have to survive in the long term
 
Last legs? Whatever.

If I had one share of Apple stock for every time I heard that "Apple is on it's last legs" or "don't buy a Mac 'cause the company will be gone in a year" or any of that "insider" or "tech business expert" doom predictions I'd own the whole company by now.
iPod will probably sell really well to the Mac faithful for the next three months, then will sell really well to everyone else with a mac when the price drops to $300-$350, and then the PCversion will sell even better to the PC crowd who will then really want to get a mac to use it properly.


________________
...and to drink, Peru!
 
Well there are bigger things to have a loss over. people predict the G5, new imac are coming out soon, so if there is going to be a huge flop it probably wont be over the iPot.
But what jef said is true. another thing, is even the biggest companies fall. I remember ionica, and look at the mess marconi was in a while back.
 
Hello again folks,

It's not the iPod in and of itself. It is the marketing approach implemented by Apple that the iPod is this new revolutionary breakthrough that is going to make people flock to the Mac format. As I see it now, the iPod is appealing to the hard core Apple constituents. Once that is gone, I'm afraid there is very little left. My initial arguement was that there is not much of a Mac-only oriented product market to start with. From the continuing reactions, it seems that Apple let down its only market in a big way. Specifically the price. If and when the iPod is PC-compatible, I don't think it will matter. As I mentioned in a previous, there is a disdain for Apple among many PC owners (and retailers, and journalists).

I don't know about Apple being on its last leg, but I would make the case that at least one leg is hurting. I agree that if the G5 machines are not released soon, and if they are not significantly better, then I think Apple is going to be in some real trouble.

 
dollar for every prediction

what does people predicting the end of apple all the time tell you about their financial health history over the years?

we don't hear that many rumors about the demise of microsoft

if apple did die, the diehard mac users would convince someone to start it up again in another form so there will always be a core loyal following like that company (for women) called maidenform which lasted a century, went under, and then got reconstituted into another maidenform

and how about those cleveland browns (in sports) or gretsch guitars (in musical instruments) or the bush family...
 
bush family

i didn't mean anything about a re-constituted bush family and that political jab was off topic ...but where there is a sincere demand for a product, no matter how small, there will be a supplier

and all those calls on this site for a new newton from apple might result in a new newton if this sight reflects the society of mac users as a whole (maybe the newton could fit into the devices strategy of the digital hub)
 
ipod is cool!

Okay, I have been reading reviews about ipod released. And most of the reviews were very good. ipod will survive!

According to ZDnet.com, Most PC users are really interested in the new Apple's product ipod. And they think PC users will eventually able to use it. Even Steve said that he will try to make ipod compatible with PC market ( but he will wait for awhile to convert some stupid PC users over to MAC first) . But it will not be as good when you use it with a MAC.

I think ipod is a breakthrough device for Apple comparing with other MP3 players (5gb). Most of other players are as huge as a CD player. Remember how trouble some to carry those around? :O) ipod is small and it's light! You can also use it as a portable HD, rather than just MP3 Player.

The only set back is the price. I think it is too expensive. Most of us wait for the price to go down. But by the time we hope Microsoft won't steal the technology. Then Apple will be in big trouble.
 
jefhatfield,

You make a lot of sense. You are exactly right about the issue of cas reserves. And today it doesn't take much to wipe out a cash reserve very quickly.

I would agree that as long as there is a demand for a product, there will be a supply. However, market share can decline to such a point that makes the company impossible to maintain. There is no money for R&D. Software developers stop writing for the platform. Retailers do not give up shelf space. New hardware development virtually stops. The company is dead.

I really hope this doesn't happen to Apple.
 
what?!

hey Micrsoft_windows hater (or whatever),
what are you talking about? $400 isn't too much for a 5GB portable firewire drive! you must be crazy!?
It's FIREWIRE. Thats a better deal than most firewire drives.
 
Cash is cash

I'm puzzled by jefhatfield's arguement regarding cash. According to Apple's CFO the company had around $4 billion in cash in January 2001. Contrary to Jef's arguement cash means exactly that - money available to spend on R&D, groceries or CDs. Whatever.

Share prices or market capitalisation is an indication of the value that investors believe a business has. This is paper money, not cash available to spend. Imagine the impact on Microsoft's share price if Bill Gates were to decide to convert his interest in Microsoft to cash - the share price would be decimated due to oversupply.

My point is that Apple's fundamentals are in place with a strong laptop lineup and a world leading operating system, (as opposed to OS 9 which sucked). Provided they get the next generation of desktops out of the door, I think there's every reason to believe they have a rosey future ahead of them.

iPod could burn up some of Apple's cash reserves, but it's no biggy if it crashes & burns. A 667Mhz Titanium Powerbook running OS X 10.1 will still be the most beautiful notebook on the planet.

I'll be first in line for an iPod when they hit the shelves in the UK.
 
Just because apple has good products ahead it doesnt mean it will sell them, make huge profits, and have a rosey future.
Think about it, intel makes sh*t and sells it to retards. They can make profit without making good products.

Apple needs a whole new marketing strategy if they want to eat into the PC market, hardware is important but if you want to sell its not as important as marketing.

Also jef is right about money, just remember the amount of real money marconi had earlier in the year and yet they were still in trouble.
 
I can't comment on the companies Jeff mentioned because I'm not familiar with them, but in general a lot of dotcom companies that had the good fortune to IPO during the dotcom boom made a lot of cash on the deal. They were in the odd position of having stacks of cash, but no income, and no prospect of an income in the future.

Of course I recognise that this is not a good position for a business to be in. Apple is not a dotcom, and its cash reserves were not built up at the expense of greedy and gullible IPO investors, but were generated by punters paying for products. For the past few years Apple has been noticably successful at selling stuff to people (with the obvious exception of the cube).

New marketing strategies? Apple clearly has plenty, with the retail stores and digital lifestyle devices being key components. Only time will tell how successful they may be.
Marconi expanded rapidly when the market for telecoms infrastructure looked promising - far from having cash reserves, they streched themselves thinly and then the market disappear beneath them. If they'd had more cash, then perhaps it could have kept them going until the telecoms market recovered! As it is they're struggling to pay their £2.5bn debts.
 
TIMEK! OR HAT MAN or whatever ur name is

TO TIMEK!!! Hey, I am only 13 years old, but I am a HUGE mac fan. We have 6 iMacs, and 2 powerbook G3's in our house. I follow up with everything apple does. I have noticed everyone says the iPod wont make it, but if you think. . . .it will. It wasnt meant to be a PC marketing event Timek, so dont get your hopes up. If you have a mac, you know about the iPod. People with PC's get PC stuff, and people with MACS get MAC stuff. I mean, it is a 5 gig external hard drive, that plays MP3's. Thats a pretty big breakthrough. Also, Timek says it will sell at Apple Stores, but wont make it at Circuit City and other sotres like it. Well, Circuit City is not a huge supporter of a mac, they just sell them. In fact, when I am at circuit city, there are more people looking at the 7 macs on disaplay, than the 800 PCs bundeled up in the corner. Also, it wasnt meant to get you to buy a Mac. It is for the Mac lovers, and to convince tthe people that are thinking of getting a mac that. .hey, this is grat, PCs dont have this, its a new breakthrough. I have no clue what you are thinkin when you say it doesnt get people to buy a mac. It was never meant to, it was for Mac users. And, Apples stock is not in the ditches. Actually it is doing better than PC stock. In the depression, it has never dropped more than 15 percent since the 9/11 bombings. MSFT is horrible. it was at 43 a few days, from 63, that is 33 percent. Just letting you know!!!
 
good observations

those are great observations for a 13 year old...you should be in the mba classes because what you say is as valid as any comment i see here on macrumors or among the mba students i have heard at graduate business school

one thing is certain, apple is not at their "best" financially (due to lower than expected sales forecasts in 2001, the cube, the colored imacs, and extremely low stock valuation) nor are they at their absolute "worst"(one could look at '96 and '97 to see how low apple could go)

and it is obvious that the ipod is not as well received as the original imac or as poorly received as the cube

so only time will tell...but i wish apple luck on this product for our sake and the sake of the company
 
I think Apple needs to take baby steps to work it's way into a greater market share with their digital hub ideas and this MP3 player is a great way to start.

Obviously they couldn't release an MP3 player, PDA, phone, new computers, digital camera, video camera, ect. into the market all at the same time. There wouldn't be enough of a market to market all of these items to. So they have to start small and work up.

If they started with a fully functioning PDA, they couldn't release an MP3 player down the road. Instead, you release the MP3 player now, and when it drops in price you release a product (iPod+) that covers the MP3 playing abilities PLUS all sorts of other things - at a higher price point.

So Apple will carve out a few new products during the next two years, and there will be some overlap, but it can be managed successfully.

Of course I don't know that Apple wants to release an iPod+ or whatever, but I think it could happen. Maybe all they would have to do is open the iPod to other software devolpers, like the PalmOS has been. That alone might make the iPod something really special.

No matter what, the iPod, unlike the Cube, has a lot of upswing. It has room to grow. The Cube couldn't ever be more than a small computer, the iPod is a great product that could be improved.

So should you buy on speculation? No, only buy one if you need an MP3 player or a really small portable harddrive. But do keep your eye on the product and think big because it might just happen and the term 'breakthrough' would be more accurate.

Just my two cents.
 
Re: good observations

I believe the iBook made up for the iMac lowering in sales. In education, Mac is the number 1 selling computer company. Time will tell, as you said. I have sold my apple stock, bought at 20, hehehe, sold at 23, didnt make a whole lot of money. But now, I believe apple is going to be a strong stock in the long run. Linux and Unix are the future. Windows has not introduced, or spoken of either. In 5 years or less, i believe apple will be on top.
 
Mac_User,

You do make some good points. However, let me respond to a couple to things you mention.

Concerning my Circuit City observations, I started being an Apple Demo Day representative at Circuit City. (It's a pretty cool way to spend a Saturday or Sunday afternoon. You get to talk about Apple products, and you even make a couple bucks.) Anyway, you just aren't correct in what you are saying about the traffic in the Mac section compared to the PC section. You may not want to hear this, but for every 100 computers sold today, about 92 or 93 of them are not Macs. That's just the way it is. You also say that Circuit City is not a fan of the Mac. I may not agree with eactly the way you put that, but I know what you are saying. But that's the problem. If Apple is not successful in stores like Circuit City, CompUSA, etc., there is no long-term future. It's all about market share and unless Apple works toward growing its market there is no future.

Also, Apple is most definitely marketing the iPod as a way for Pc users to switch platforms. Steve Jobs has made this clear in the articles I have read about the iPod.

While I would like to see Apple on top in five years, it's just not going to happen. Microsoft won this war a long time ago. Apple can still be successful (I hope it will.) but there are a lot pitfalls and one or more serious mistakes can be fatal.
 
Timek

Timek, I know apple will be on top. Microsoft MUST switch to Linux or Unix sometime, it is the future. They make their computers with all different parts, that is their problem. Example: Farallon e/net, IBM HD, Orange Link USB etc. When the change comes, Microsofts products will not work with Linux or Unix. YOu will have a computer with no ethernet, usb, cd drive, hard drive, or even processor. This change will come. Technology is accelerating, and Microsoft is stuck. Also, back on the iPod. I believe it was mainly for the Hip Hop crazy people who are INTO music. When they see this, they will freak out. They will see it is Mac compatible only, and say "what the hell am i doing with the PC". As you probly know half the people with a PC can burn a CD. Thats what the iPod was meant for. Believe me on the Unix Linux thing, it is true. I run OS 10.1, and it is awesome. I have run DOS at school, and it has way to many bugs. Remember, its not the accessories that count, its the CPU!
 
That's the IDEA

Steve and the team SAID that they are not looking to sell iPod to everyone. Obviously because they made it MAC only! I think we are morons for telling Apple or ourselves that, woops, it's not going to make it to the PC world, when they designed it from the start that way!

Steve hopes to sell iPod to a percentage of Mac/Firewire owners and to a percentage of those who need that one more feature to need to upgrade to a new Mac that has Firewire on it. . . like me and my old rev a iMac.. (i love that computer.) So, I went and bought a new Powerbook.

I will buy an iPod.

It is enough for me..

Thanks Steve! I love your work, you are a genius.
 
cash flow and re:cash reserves

i will try to explain my point about cash reserves (i used to be a vice president of a dot.com in san jose before i became a techie) so i know how fast cash reserves could go down

i am not talking mba textbook here since i was one of thousands of first year mba students (with at least ten years of work experience) who ditched grad school midstream to make it in the valley...there is no better teacher than failure the first time out!

One day, I am supposed to plan a meeting with Paul Allen's people, the next, my CEO has to sell her gold range rover and consider going back to school

when your back is up against the wall and reporters are asking about the bad health of your company due to wall street ignoring your stock, it is common for CFOs (chief financial officers) to mention the still positive points a company has left to avoid focusing on the negative

a company makes money through sales revenue and through the investment world (through stocks, venture capitalists, angel investors, etc)

now when the money goes out for the everyday operating expenses, paying off suppliers, and research and development....it cuts into the money made from stocks, revenue, and cuts into the cash reserves

apple has thousands of employees and the research and development is not exactly cheap either...did you know it took apple 18 months to coordinate just the failed color schemes in the dalmation and flower power iMac?

when gil emilio had apple, the company was almost out of business yet they had strong cash reserves but they would have depleted them in a couple of years...it took steve jobs and his imac to save apple, not bolster cash reserves...what helped was that investors got interested in apple again and it helped with finacing the ibook, G4, and other great computers...now if they had relied on cash reserves alone, they would have gone back to the bottom

steve jobs does not own apple, the investors do and this stock market "paper money", while secondary to money made from sales like foocha mentioned, is still a vital part of a company and without it, a company can rip through its cash reserves

4 billion is nice, but try 90 billion for that "other" company which, while at 40 or 50 something a share, still has not lost 80 percent or more of its value in stock like apple, cisco, yahoo, and others in the valley

apple also has some of the most expensive multimillion dollar high profile print ads in major US magazines

many companies in the valley tried to work off of cash reserves and this didn't work well enough since the money had dried up from the stock market last year

apple may not be dead like a lot of mac users think it is, but it is not thriving like dell either who has arrived as top dog in the computer world...their only serious competitor compaq went down and got sold to hp which fortune magazine has characterized as two stones being tied together hoping it will float this time

now that i have thoroughly bored you with biz talk on a techie site, i want to apologize since i am a new techie (since '99) and it is the field i now choose for the second half of my life

i hope these observations help and it is not a stab at apple since i am a pc techie, microsoft certified to boot...yikes

but i use an ibook at home and macs are my primary computers now for almost 20 years but i am not quite a zealot yet because, while i am getting older and i am tired a lot, i still like to use my brain and think for myself and i hope i have the right to pick and choose the mac items i like and the ones i don't

that said, i think the ipod is cool, finally relating to "this" thread, and low sales (if they do occur) won't completely destroy apple or make them any less of a company in the eyes of most mac users
 
i will talk for myself

...ok...to be fair...a doomed iPod, if it tanks, won't affect how i feel about apple
 
jefhatfield,

Great post!!! I think your observations are right on the money. I agree that if the iPod is not successful and is a bust it will not bring Apple down. But I am not completely sold on the iPod and digital hub concept. I think that if Apple is staking its future on this, and it doesn't work, then there is something to worry about. That is what concerns me.

Since you are PC techie, was is your take on the Linux and Unix issue that Mac_User raised in regard to Microsoft. I don't know enough about these platforms to make any kind of intelligent statement. I'd be interested to hear your thoughts. Thanks.
 
linux or unix

i am a middle aged mba candidate who got his degree in business and not electonic engineering so i can't comment if linux or unix is the future...i worked for the third richest company in silicon valley and the funny thing is, even though i became very close to them, i never met one computer science graduate in the IT department of this 800+ location company

in fact, of the thousands of IT employees i met in silicon valley through the years, only one had a CS degree, and from chico state...apparently he must have studied while he drank beer...just kidding

...i do know a senior IT engineer of nearly 20 years of experience who says linux is still the windows killer...let me tell you, it is not OSX even though OSX is ten times better (but i wish it was...linux, after all, is free)

linux is number two in operating systems behind windows and mac os is number three

others like os/2 and beOS follow in order of popularity along with the Sun operating system

...and don't take my comment about CS majors the wrong way

...you will be recognized as important someday when the electronic engineers perfect their product, and thus make their motherboards and cards so cheap they are not even a financial factor anymore!

...at that time, the CS majors in college right now or in thirty to fifty years, will be the ONLY ones out there with the skills necessary to keep the field profitable - i know this has been a prediction since the 1970s when the degree was created nationally, but if you are a CS major, you will have your day like the engineers of the 70s and mba's of the 80s and 90s did!

...when hardware is not a factor it IT, programming and software engineering will be the entire market

that, of course, is a very conservative prediction (since i remember the early 1970s pundits who predicted a computer in every home by 1980 or 1985!)

[Edited by jefhatfield on 10-30-2001 at 07:28 AM]
 
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