So 2006 was a good year but this was the height of the iPod years (in billions $ 7.676 for iPods Vs. 7.375 all macs).
Apple's documents state that they only spent $500 million on all forms of Apple R&D during all of 2006, which is the year during which the major Purple 2 iPhone project work took place.
That was only 3.7% of their 2006 revenue.[\QUOTE]
First of all from the report I see R&D expenses at 712 millions $ (nitpicking here).
You have to realise though that the iPhone wasn't whipped up in 2006 only, and that that accounts for all R&D (OS X, Macs, iPods etc.).
While the designs that ended up becoming the iPhone were finalized around those time the iPhone is the sum of years of development in I/O, GUI, OS etc.
For years Apple had been toying with tablets prototype (since 2002 at least), and those are the risk I was talking about...
For years you design prototypes, you decide to investigate further (look at the profits of Apple circa 2002 when they were investigating tablets), at some point they decide to go a pretty risky way (at first the OS was supposed to be based on the iPod linux-like OS) by deciding that iOS would be a distant cousin of OS X, that means development teams were spent working on something that might be a failure, you then green-light production and it become an even larger risk.
Ask all the companies that tried to sell Androids tablets this past few years, if you build billions of dollars worth of electronic devices and nobody buys them there goes your year's profits.
The thing is move on to what?
A lot of people have argued that Apple computer business has benefitted from the halo effect of the iPod and now the iDevices, if the iDevices had been flops Apple would probably be in the sad position of most of the computer industry...
PC sales are dwindling (compared to mobile devices), profits are harder to come by in computers (like for Apple before iPods), iPods are being replaced by mobile devices.
Without iPhone & iPad, Apple would be surviving on their iPod treasure chest awaiting a slow and painful death (RIM, Nokia etc.).
Unless of course they invented something great again (how that looking for RIM & Nokia again?)that some people feel its okay to steal ^^.
For people interested Apple's 2006 annual report. You can also find all the others reports there.
So 2006 was a good year but this was the height of the iPod years (in billions $ 7.676 for iPods Vs. 7.375 all macs).
Lets look at Apple yearly <revenue (profits)> history (in billions $) :
2011 : 108.249 (25.922) 23.9%
2010 : 65.225 (14.013) 21.48% START of the influence of iPad
2009 : 42.905 (8.235) 19.19%
2008 : 37.491 (6.119) 16.32%
2007 : 24.578 (3.495) 14.2% START of the influence of iPhone
2006 : 19.315 (1.989) 10.2%
2005 : 13.931 (1.328) 9.5%
2004 : 8.279 (0.266) 3.2%
2003 : 6.207 (0.057) 0.9%
2002 : 5.742 (0.042) 0.7% START of the influence of iPod
2001 : 5.363 (-0.025) -0.4%
2000 : 7.983 (0.786) 9.8%
1999 : 6.134 (0.601) 9.79%
1998 : 5.941 (0.309) 5.2%
1997 : 7.081 (-1.045) -14.7%
We can see that Apple grew with every innovation (revenues x15 since 1997) but the profitability only shoot up with the advent of the mobile devices, and profitability is what allows a business to thrive.
So Apple was doing OK selling iPods, so Samsung didn't hurt them that much?
Look at how quick things went from good to bad for companies like RIM or Nokia when their base product lost market shares...
If the iPhone had failed Apple would have managed to survive on iPod money for some time but the iPod days are numbered and so would have been Apple days if they hadn't come up with something new. Every cent that Apple can't extract from their inventions might be pretty important down the road.
Apple's documents state that they only spent $500 million on all forms of Apple R&D during all of 2006, which is the year during which the major Purple 2 iPhone project work took place.
That was only 3.7% of their 2006 revenue.[\QUOTE]
First of all from the report I see R&D expenses at 712 millions $ (nitpicking here).
You have to realise though that the iPhone wasn't whipped up in 2006 only, and that that accounts for all R&D (OS X, Macs, iPods etc.).
While the designs that ended up becoming the iPhone were finalized around those time the iPhone is the sum of years of development in I/O, GUI, OS etc.
For years Apple had been toying with tablets prototype (since 2002 at least), and those are the risk I was talking about...
For years you design prototypes, you decide to investigate further (look at the profits of Apple circa 2002 when they were investigating tablets), at some point they decide to go a pretty risky way (at first the OS was supposed to be based on the iPod linux-like OS) by deciding that iOS would be a distant cousin of OS X, that means development teams were spent working on something that might be a failure, you then green-light production and it become an even larger risk.
Ask all the companies that tried to sell Androids tablets this past few years, if you build billions of dollars worth of electronic devices and nobody buys them there goes your year's profits.
The thing is move on to what?
A lot of people have argued that Apple computer business has benefitted from the halo effect of the iPod and now the iDevices, if the iDevices had been flops Apple would probably be in the sad position of most of the computer industry...
PC sales are dwindling (compared to mobile devices), profits are harder to come by in computers (like for Apple before iPods), iPods are being replaced by mobile devices.
Without iPhone & iPad, Apple would be surviving on their iPod treasure chest awaiting a slow and painful death (RIM, Nokia etc.).
Unless of course they invented something great again (how that looking for RIM & Nokia again?)
For people interested Apple's 2006 annual report. You can also find all the others reports there.