In its fourth-quarter 2008 Quarterly Results Conference Call, Apple Inc. executives CEO Steve Jobs, CFO Peter Oppenheimer and COO Tim Cook made several comments concerning the iPod, iPhone, and Apple TV. At the start of the call, Oppenheimer stated that because deferred iPhone revenue has grown so much — to $5.8 billion at the end of the September quarter, or more than 39% of Apple’s total revenue had it not been deferred — the company will begin providing quarterly non-GAAP info to show how iPhone/Apple TV numbers are used internally, including adjusted sales, the adjusted cost of sale, and adjusted net income.
Apple CFO Tim Cook made several statements regarding the iPod and iPhone, revealing that the latter was shipping to carriers in 51 countries by end of the quarter, with 30,000 points of distribution. He also revealed the company had roughly 2 million iPhones across all of the 51 countries in inventory, and said Apple thinks that’s about right for 4-6 weeks of inventory. Cook declined to give hard numbers on how many of the iPhones went to new users or first-gen owners, saying that information was confidential to Apple’s carrier partners, but added that since the company expanded from six to 51 countries, there were a large amount of iPhones being sold to first-time buyers.
On iPods, Cook said that sales were up eight percent for the quarter, but noted that the final weeks of quarter we were running flat year-over-year, adding that it’s difficult to predict whether the usual holiday seasonal lift will follow the pattern that it has before. Cook also hinted at possible iPhone price cuts while outlining Apple’s price drop on the iPod touch, from $299 to $229 on the 8GB model, with $100 off the others, and doubling the memory on the iPod nano while maintaining current price points.
Apple CEO Steve Jobs also made several sweeping statements, regarding the iPhone as both a netbook competitor and in comparison to other cellular handset makers, and the Apple TV. Discussing the pricing of the company’s Mac line relative to the economy, Jobs explained that Apple considers the iPhone as one of the company’s entries into the netbook category, while simultaneously stating that there weren’t many netbooks being sold. When asked about Apple’s decision to produce only one model of phone, Jobs explained that while most companies in the past have chosen to make a great number of different models, as software becomes a differentiating technology in the category, these different models will be unattractive to developers. He said that Apple approaches the market as a software platform company, suggesting that Apple will make very few models in order to make same software available across all phones. Finally, discussing the Apple TV, Jobs again stated that the category was a “hobby,” repeating his prior statement that he doesn’t think anyone has yet succeeded in it, while adding that he thinks it will continue to be a hobby in 2009.
Making a rare appearance during the company’s quarterly results conference call, Apple CEO Steve Jobs discussed several topics, including iPhone sales, the App Store, and the economy. Notably, Jobs compared Apple’s iPhone sales in the quarter to that of rival Research In Motion, stating that Apple “beat” RIM by selling 6.9 million iPhones compared to RIM’s sales of 6.1 Blackberry devices. “Even more remarkable,” Jobs said, was the fact that measured by revenues, Apple has become the world’s third-largest mobile phone supplier, behind only Nokia and Samsung. Stating that deferred iPhone revenue has grown to $5.8 billion dollars, or 39% of Apple’s total revenue, Jobs said it was “too big to ignore,” while outlining the company’s reporting of non-GAAP financial results to help investors get a better sense of Apple’s actual business. Later, when asked about the upcoming year and the possibility of the market being cluttered with iPhone “wannabes,” Jobs said the company has to be the best, without leaving a price umbrella underneath the iPhone. He noted that Apple has a great partner in AT&T, and that both are committed to making the iPhone a great value for customers, while hinting that the “next round” would include either lower prices or new models.
Speaking about the App Store, Jobs said Apple has changed the value proposition for mobile devices. He said the Store will see its 200 millionth download tomorrow, now offers over 5,550 applications, and is available in 62 countries around the world. The rate of new submissions increases every week. “We’ve never seen anything like this in our careers,” Jobs said. He also said that customers are now attracted to iPhone not only for its functionality and multi-touch user interface, but also its ability to add free games and applications.
Discussing the economy, Jobs described Apple customers as some of the smartest, most product-aware customers in the market, saying that they are unlikely to abandon the quality and seamless integration of Apple’s products. He went on to say that they are more likely to delay purchases than switch away from the company’s products, and that while Apple may not appeal to every prospective customer, the percentage it needs to appeal to in order to grow its share isn’t that many. Finally, he noted that Apple has almost $25b safely in the bank, and zero debt.
According to sales numbers provided by Apple in its quarterly results releases, the company has now sold more than 174 million iPods, and more than 13 million iPhones. “iPhone had a breakout quarter. Nearly 6.9 million sold, exceeding the 6.1 million shipped during entire lifetime of first-gen iPhone,” said Apple CFO Peter Oppenheimer, speaking during the company’s quarterly results conference call. Oppenheimer added that Apple has already surpassed its goal of 10 million iPhones sold in 2008. The iPhone accounted for $806 million in recognized revenue in the fourth quarter, while Apple increased the number of countries in which the iPhone is sold from 6 to 51. It expects to be in over 70 countries by end of December quarter, with over 30,000 points of distribution around the world.
Discussing its music products and services, Apple noted that the iPod’s marketshare is over 70% in month of September, while it continues to gain share year-over-year in most international markets, including the UK, France, Germany, Japan, and Australia. Customers are “loving” the new fastest way to purchase an iPhone - starting with web at home, it takes only 1 minute more than buying an iPod when you get to the store. The iTunes Store now has 65 million customer accounts, and offers more than 8.5 million titles.
Reporting its fourth-quarter financial results today, Apple said it sold 11.05 million iPods during the quarter — more than an eight percent increase compared to the same quarter last year, and slightly more than the 11.011 million sold in Q3. It also sold 6.89 million iPhones in the quarter, up from 1.119 million in the year-ago quarter and an artificially-low 717,000 in Q3 2008. The company posted revenue of $7.9 billion and net quarterly profit of $1.14 billion, or $1.26 per diluted share, compared with revenue of $6.22 billion and net quarterly profit of $904 million, or $1.01 per diluted share in Q4 2007. Sales of Other Music Related Products + Services were $832 milllion in Q4, up from $601 million in the year-ago quarter and $819 million in Q3. That category includes iTunes Store sales, iPod services, and revenues from Apple and third-party iPod accessories.
“Apple just reported one of the best quarters in its history, with a spectacular performance by the iPhone—we sold more phones than RIM,” said Steve Jobs, Apple’s CEO. “We don’t yet know how this economic downturn will affect Apple. But we’re armed with the strongest product line in our history, the most talented employees and the best customers in our industry. And $25 billion of cash safely in the bank with zero debt.”
“We’re very pleased to have grown revenue 35 percent and to have generated $9.1 billion in cash in fiscal 2008,” said Peter Oppenheimer, Apple’s CFO. “Looking ahead, visibility is low and forecasting is challenging, and as a result we are going to be prudent in predicting the December quarter. We are providing a wide range for our guidance, targeting revenue of $9.0 to $10.0 billion and earnings per diluted share between $1.06 and $1.35.”
SwitchEasy has introduced its new NeoTouch case for the second-generation iPod touch. Like the CapsuleNeo for iPhone 3G, the NeoTouch uses three distinct layers — a 0.6mm thick tactile silicone membrane, a GE Lexan H-Frame, and a slip-free polyurethane coated I-Clip — to offer comprehensive protection. Other features include open access to the screen, home button and headphone jack and tactile button covers for the power and volume buttons; NeoTouch also includes two anti-static screen guards, a microfiber wipe, a Universal Dock adapter, a video stand, and a Dock Connector cover. SwitchEasy’s NeoTouch case for the iPod touch 2G will be available in about three weeks in black and white and will sell for $25.
Update: Following the publication of this story, we were informed that the NeoTouch was posted on the SwitchEasy site in error, and that the case would be launching in approximately three weeks. We have updated the above story to reflect this information.
In an effort to capitalize on demand for a Beatles iPod, which has not been offered by Apple despite years of rumors, Bloomingdales is currently offering a Limited Edition Collector’s Box Beatles iPod Set. The $795 package includes a black 120GB iPod classic with the Beatles’ logo etched on the front above the Click Wheel, and Abbey Road on the back. The set also includes 13 original Beatles CDs, two Masters albums, the “Love” album, and an engraved guitar pick, all encased in a custom box designed by Psycho Bunny. The package is limited to 2500 sets.
Apple has begun adding a small “Sequence Shortened” disclaimer to its latest iPhone television ads. Jason Fried of 37signals noticed the text in the new ad “Game Changer;” Apple has previously been sued in part over what some complain were misleading advertisements for the iPhone 3G, which showed faster than real-world performance.
Smule, the developer behind Sonic Lighter, a virtual lighter application for iPhone, has released Sonic Boom, a new virtual firecracker application for iPhone and iPod touch. Sonic Boom allows users to resize both the firecracker (or TNT) and fuse length, place pictures on the firecracker, explore the exploded debris and use a time bar to slow down or speed up an explosion. In addition, owners of Sonic Lighter can use that app running on a second iPhone or iPod touch to light the fuse in Sonic Boom, and as with Sonic Lighter, explosions created with Sonic Boom are mapped and recorded, allowing others to see where and when the app is being used. Sonic Boom is available now from the App Store and sells for $1.
Mark/Space, developer of well-known synchronization software The Missing Sync, has released its new Fliq application for the iPhone and iPod touch. Fliq is a social networking application that allows iPhone and iPod touch users to send photos and contacts to one another. “Fliq offers real-time social networking between friends in close proximity,” said Brian Hall, CEO of Mark/Space. “There’s no emailing, texting or instant messaging configurations to set because Fliq is a stand-alone app that allows users to sync up to share photos and contacts with anyone else on the same Wi-Fi network.” Fliq is now available as a free download from the App Store.
Speck Products has announced that it is now shipping its PixelSkin cases for the fourth-generation iPod nano and second-generation iPod touch. Announced in September, PixelSkin is a form-fitting silicone case featuring a textured tile pattern for added grip and shock protection and open access to all ports, sensors, and controls. PixelSkin for iPod nano 4G is available in ten different nano-matching colors and sells for $20, while PixelSkin for iPod touch 2G is available in seven different colors, and sells for $25. For more information on Speck’s PixelSkin for iPod nano 4G and iPod touch 2G, see our full review.
H2O Audio has launched its new iDive 300 “Deep Dive” Waterproof Housing and Over Ear Speakers for iPod. Built from polycarbonate, the iDive uses a locking cam knob to provide a robust, secure seal, which is waterproof down to 300 feet. Other features include an integrated microprocessor for push-button control of touch screen and Click Wheel iPods, a built-in amplifier that runs on three AA batteries and provides high quality stereo sound, acoustically engineered over ear speakers that can be attached to a mask strap or tucked under a diving hood, and a lanyard loop for easy attachment. H2O Audio’s iDive 300 is available now and sells for $350.
SwitchEasy has introduced its new CapsuleThins cases for the fourth-generation iPod nano. Made from GE Lexan polycarbonate, the CapsuleThins measure only 1.2mm thick, and offer open access to the Click Wheel, headphone jack, and hold switch. In addition, each case includes an anti-static screen protector, two Click Wheel protectors, a microfiber cleaning cloth, a custom Universal Dock adapter, a video stand, a Dock connector protector, and a headphone adapter. SwitchEasy CapsuleThins for the iPod nano 4G are available now in clear or black and sell for $20. For more information on the SwitchEasy CapsuleThins, see our First Look article.
Apple recently reached an agreement with wireless device distribution firm Brightpoint to distribute iPods and iPod accessories in Australia. “We are excited about the opportunity to work with Apple and look forward to expanding our business with Apple in Australia,” said Bruce Thomlinson, President of Brightpoint Asia Pacific. “Moving into the portable music space with iPod creates a new product category for us and complements our vendor and product portfolio range in the market.”
Hey Mac Software has released Briefcase, its new file transfer software for the iPhone and iPod touch. Briefcase allows users to connect to and browse computers running on a local network or remotely via IP address, and can also connect to other iPhones running Briefcase or Briefcase Lite, or to any machine supporting SSH. It features secure downloading and uploading, and the ability to view/open many files, including Word, Excel, PDF, Pages, Keynote, MP3, and M4V files. Briefcase is available now from the App Store and sells for $5.
Azure Talon Software has introduced iLaugh 1.0, its new joke database software for the iPhone and iPod touch. iLaugh provides users with a variety of sources, some of which offer clean, family-friendly jokes, containing a total of more than 20,000 jokes. iLaugh is available now form the App Store and sells for $1.
Electronic Arts has released a new free preview version of its Spore Origins game for iPhone and iPod touch. Free Spore Origins LE lets users customize their creature and play through one level of the game, while providing video previews of the entire game and advertisements for other Electronic Arts titles, which are optional to view. Free Spore Origins LE is now available as a free download from the App Store.
Audio Technica has released its new ATH-CK100 earphones (Translated Link) featuring triple driver technology, similar to that found in the Ultimate Ears’ Triple-Fi 10 Pro and Shure’s E530. According to the company, the new ATH-CK100 earphones feature a titanium housing, and are the “world’s smallest” triple-driver earphones. The new earphones will also offer a frequency response of 20Hz-18kHz, and will be available in Japan on November 21 for around 56,700 yen, or around $560. [via Akihabara News]
iPodweek, iLounge’s weekly newsletter recapping the last seven days in iPod, iPhone, iTunes and Apple TV news, articles, reviews, and more, will be sent out later today. In addition to rounding up the week’s top stories, iPodweek also features giveaways and accessory discount offers from various companies. If you haven’t yet signed up to receive iPodweek, there’s still time to register and receive this week’s edition — just use the simple form below to submit your email address.
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In addition, voting is still open for our 2008 Readers’ Choice Awards. This quick 4-question poll lets you name your picks for 2008 iPhone + iPod Application Developer of the Year, 2008 iPhone + iPod Game Developer of the Year, 2008 iPod + iPhone Accessory Developer of the Year, and favorite new Apple media player of the year. The current developer leaders are Logitech, for the first time surging over Griffin Technology in the accessories category, Pandora, maintaining a lead in the apps category, and Gameloft, which is currently the leader in the games category. Notably, hundreds of additional developers are represented in the Write-in categories, including companies such as Shure, Bowers + Wilkins, Altec Lansing, Tapulous, Laminar, Demiforce, and others. Up to 17.3% of votes in a given category come from write-in candidates, so keep your
favorite picks coming!
Apple CEO Steve Jobs has posted a new update discussing the company’s environmental progress through 2008 and announcing new Product Environmental Reports for each new Apple product introduced. “For the past several years, Apple has made a concerted effort to be more transparent about the steps we are taking to protect the environment and make our business more sustainable. In this environmental update, I’d like to inform you of our recent progress and introduce you to a groundbreaking system of reporting that we believe is unmatched in our industry,” Jobs writes. “We’re approaching this issue at a product level because we think it’s the best way to help our customers make informed decisions about their own carbon footprint and how to reduce it. I encourage you to check out these new reports.”
iPhone and iPod touch game developer and publisher ngmoco has revealed its first three releases. Described by the company as a “flagship premium game,” Rolando is a platform-style game developed by Hand Circus in which players will need to solve puzzles and navigate obstacles through 36 levels in order to save the world from “forces of darkness.” It will be available later this fall. MazeFinger is an arcade-style game in which players must touch their way through 1000 unique mazes while battling the clock. It will be available on the App Store this weekend for $1. Topple is a fast-paced tower-building game with multiple levels and game modes. It will be available later this month.
Taiwanese manufacturer Luxpro has filed a lawsuit against Apple with the United States District Court in Arkansas, accusing the company of “unending aspiration to monopolize the worldwide MP3 player market by preventing fair competition from smaller MP3 player manufacturers.” The complaint goes on to state that Apple “deliberately makes digital music purchased at the iTunes Store inoperable with its competitor’s MP3 players.” Apple has yet to comment on the matter.
i2i Gear has announced the release of its i2i Stream universal wireless audio solution. The i2i Stream system utilizes two twin controllers — which can be set to receive or transmit — to send audio from the media source to a headset or speakers. Features include color-coded channel selection, integrated batteries that provide 5-7 hours of playback time and recharge via USB, 2.4GHz uncompressed audio transmission, volume dials to control audio levels independently of the media source, and compatibility with most audio sources, including the iPod and iPhone. Each i2i Stream system ships with two controllers, with 12- and 28-inch audio cables, USB charging cables, lanyards, and belt clips for each. i2i Gear’s i2i Stream wireless audio solution is available now and sells for $120.
Apple today announced that all four major U.S. networks are now selling primetime TV shows in HD on the iTunes Store. The store first began selling HD TV shows from ABC, NBC, and CBS, Fox has since begun offering its programming in HD. Additionally, Apple states that the iTunes Store is now the world’s largest online TV store with over 200 million TV episodes sold, including more than one million HD episodes since the launch of HD TV on September 9.
“We’ve got an incredible Fall 2008 TV lineup with over 70 primetime comedies and dramas, including many of the most popular shows on TV in stunning HD,” said Eddy Cue, Apple’s vice president of Internet Services. “With over 200 million episodes sold, iTunes customers have proven they love watching television on their computer, iPod, iPhone and TV with Apple TV.”
If you haven’t yet voted for our 2008 Readers’ Choice Awards, now’s the time to do so. This quick 4-question poll lets you name your picks for 2008 iPhone + iPod Application Developer of the Year, 2008 iPhone + iPod Game Developer of the Year, 2008 iPod + iPhone Accessory Developer of the Year, and favorite new Apple media player of the year. Here’s a brief overview of the current leaders in each category:
Best new Apple digital media player of 2008: So far, the iPhone 3G has a solid lead, but any of the new iPods could take the crown.
iPod + iPhone Accessory Developer of the Year: Griffin Technology has a lead over Logitech and other accessory makers. Could it be the wisely-placed vote link banner on Griffin’s web page?
iPhone + iPod Application Developer of the Year: Pandora has a lead over other competitors at the moment, but only by hundreds of votes—it’s still anyone’s game.
iPhone + iPod Game Developer of the Year: Gameloft currently has a lead over competitors, but there are lots of write-in votes in all three of the developer categories—up to 14% right now.
Let your opinion be heard: get your vote in today! The survey ends on October 29, 2008, and winners will be announced in the 2009 iPod + iPhone Buyers’ Guide on October 31, 2008. If you’re a developer and would like a shot at a Readers’ Choice award, you can download banners for use on your website. Thanks for your votes so far and best of luck to all of this year’s developers!
Marware has announced that it is now shipping its Eco-Runner case for the fourth-generation iPod nano and its Sport Grip case for the second-generation iPod touch. The Eco-Runner for iPod nano 4G is a combination wrist/armband case made form eco-friendly materials. Designed to accommodate both the iPod nano and the Nike+iPod receiver, the case offers an integrated clear vinyl protector for the nano’s screen and Click Wheel, open access to the headphone jack, and comes with an attached wristband and armband extension. The Marware Eco-Runner for iPod nano 4G comes in grey with green contrast and sells for $35. Marware’s Sport Grip for iPod touch 2G is a form-fitting silicone case featuring a protective Dock Connector slot, open access to the touch’s screen, and including a clear film protector and cleaning cloth. Available in black, white, or frosted silicone, the Marware Sport Grip for iPod touch 2G sells for $20.
Griffin Technology has introduced its new Wave case for the fourth-generation iPod nano, second-generation iPod touch, and iPod classic (120GB). Like its predecessors, the new Wave case features overlapping, interlocking wave-shaped contours that hold the case together. Other features include a form-fitting, polycarbonate build, open access to the headphone jack, dock connector, and other ports and controls, Griffin’s EasyDock design for expanded compatibility with docking accessories, and an included static-peel screen protector and cleaning cloth. Griffin’s Wave case sells for $25 and is available for the iPod nano 4G and iPod classic (120GB) in white or black, while the iPod touch 2G version is available in white, black, or pink. In addition, Griffin is offering two-packs of the Wave for iPod nano 4G and iPod touch 2G in black & green or black & white for $35. For more information on Griffin’s new line of Wave cases, see our First Look article.
This week’s featured photo is from our iPods Around the World gallery, and shows a fifth-generation iPod at Mesa Verde National Park in Colorado. To share your photos and to be considered for our Photo of the Week, you simply need to submit your own photo to one of our galleries. So get out there, take some pictures with your iPod or iPhone, and maybe your submission will be our next Photo of the Week!
Toys R Us is set to begin offering select iPod shuffle, iPod nano, and iPod touch models in its stores nationwide for “the first time ever” on October 19. Marketnews.ca notes that although the iPods are not yet listed on either Toys R Us’ U.S. or Canadian websites, the players have been available through its U.K. affiliate for more than a year. According to the company, it will also offer a variety of accessories “that kids need to complement their iPods, including iHome items, iTunes gift cards, as well as products like carrying cases and car adapters for use on-the-go.” Toys R Us says it will support the iPod rollout through a comprehensive marketing campaign consisting of print promotion, in-store signage and a special “iPod boutique” area in stores.
Google is reportedly readying new iPhone-specific advertising options to let companies target these users directly. Adweek reports that in various meetings with agencies, Google has presented an option to show different ads in response to searches made from iPhones. This would allow advertisers to provide iPhone-specific click actions, such as calling an airline to make reservations, or highlight a company’s iPhone-optimized web site. Google has yet to publicly confirm the feature.
A new study on MP3 usage from the EU’s Scientific Committee on emerging health risks suggests that as little as one hour of iPod/headphone use a day for five years might make as many as one out of every ten listeners deaf. While MP3 players in Europe are limited to 100 decibels, the scientists found that anything above 89 decibels listened to with regularity has an effect that is louder than the limits imposed on factories. “Decision makers and opinion formers are finally waking up to the hearing loss time bomb threatening many young MP3 users,” said Emma Harrison, head of campaigns at the Royal National Institute for Deaf People. “We want to see the Government and industry taking decisive action to save the hearing of future generations.”
Fonix Speech has introduced its new Fonix iSpeak application for the iPhone. iSpeak is a voice dialing application, which lets users place calls by speaking the name of a contact followed by their location (mobile, home, work, etc.). Fonix notes that due to the lack of Bluetooth access in the iPhone SDK, iSpeak does not currently support voice dialing from Bluetooth headsets. Fonix iSpeak is available now via the App Store and sells for $15.