- October 19, 2009
Reporting its fourth-quarter financial results today, Apple said it sold 10.2 million iPods during the quarter—an eight percent decline from the year-ago quarter, and equal to Q3 2009. It also sold 7.4 million iPhones, a seven percent increase from the 6.89 million sold in the year-ago quarter and a 40% increase from the 5.2 million units it sold in Q3. The company posted revenue of $9.87 billion and net quarterly profit of $1.67 billion, or $1.82 per diluted share, compared with revenue of $7.9 billion and net quarterly profit of $1.14 billion, or $1.26 per diluted share in Q4 2008.
Sales of “Other Music Related Products + Services” were up 22% over the year-ago quarter and 6% from the third quarter of 2009, to $1.018 billion total. That category includes iTunes Store sales, iPod services, and revenues from Apple and third-party iPod accessories. Revenue from iPhone and Related Products & Services, which includes iPhone handset sales, carrier agreements, and Apple-branded and third-party iPhone accessories, was $2.3 billion, up 36% from Q3 2009 and 185% over the year-ago quarter.
“We are thrilled to have sold more Macs and iPhones than in any previous quarter,” said Steve Jobs, Apple’s CEO. “We’ve got a very strong lineup for the holiday season and some really great new products in the pipeline for 2010.”
“We are delighted with our September quarter and fiscal 2009 results,” said Peter Oppenheimer, Apple’s CFO. “For the full year, we grew revenue by 12 percent and net income by 18 percent in extraordinarily challenging times. Looking ahead to the first fiscal quarter of 2010, we expect revenue in the range of about $11.3 billion to $11.6 billion and we expect diluted earnings per share in the range of about $1.70 to $1.78.”
- October 19, 2009
A newly published Apple patent suggests the company is developing a feature for its MobileMe subscription service that would sync playback state across devices. The feature would allow users to begin watching or listening to a file on one device, such as a computer, and then switch to a separate device, like an iPhone, with their current position within the media file synced automatically. Curiously, the patent covers both locally and remotely stored media, and mentions a system of automatic content retrieval based on anticipated future content access. As with all Apple patents, this filing does not necessarily represent any future product release from Apple, but offers evidence of the company’s research in this area. [via Engadget]
- October 12, 2009
Former Genentech CEO and current Apple board member Dr. Arthur Levinson has resigned as a member of Google’s Board of Directors, effective immediately. In a statement, Google CEO Eric Schmidt said, “Art has been a key part of Google’s success these past five years, offering unvarnished advice and vital counsel on every big issue and opportunity Google has faced. Though he leaves as a member of our Board, Art will always have a special place at Google.” Levinson’s position on the Board of Directors at both Apple and Google was a point of concern in the Federal Trade Commission’s investigation into the close ties between Apple’s and Google’s board; Levinson’s departure follows that of Schimdt from Apple’s board, severing one more tie between the two companies.
- October 7, 2009
In a letter written to Apple CEO Steve Jobs, U.S. Chamber of Commerce CEO Tom Donohue has responded to Apple’s decision to resign its membership over the Chamber’s stance on climate change regulation. Specifically, the Chamber is opposed to the Environmental Protection Agency’s decision to regulate greenhouse gas emissions. “It is unfortunate that your company didn’t take the time to understand the Chamber’s position on climate and forfeited the opportunity to advance a 21st century approach to climate change,” Donohue wrote. “While we do support legislation to address climate change, we oppose legislation such as the Waxman-Markey bill that numerous studies show will cause Americans to lose their jobs and shift greenhouse gas emissions overseas, negating potential climate benefits.” He also said that the Chamber is focused on innovation and technology as tools to combat climate change, adding, “it is a shame that Apple will not be part of our efforts.”
- October 6, 2009
Apple has resigned its membership in the U.S. Chamber of Commerce “effective immediately” over the organization’s opposition to the Environmental Protection Agency’s decision to regulate greenhouse gas emissions. According to the Wall Street Journal, the Chamber of Commerce claims it is not opposed to climate change regulations, just those that have been proposed in Congress and/or discussed by the EPA. Apple is the fifth company to make a withdrawal from the Chamber over the issue, but was by far the most harsh in its execution; three other companies simply said they would not renew their membership at the end of the year, while Nike quit the Chamber’s board of directors. From Apple’s letter to Chamber of Commerce CEO Tom Donohue:
“We strongly object to the Chamber’s recent comments opposing the EPA’s effort to limit greenhouse gases…Apple supports regulating greenhouse gas emissions, and it is frustrating to find the Chamber at odds with us in this effort. We would prefer the Chamber take a more progressive stance on this critical issue and play a constructive role in addressing the climate crisis. However, because the Chamber’s position differs so sharply with Apple’s, we have decided to resign our membership effective immediately.”
- October 2, 2009
A lawsuit between Apple and Eight Mile Style LLC and Martin Affiliated LLC, music publisher and copyright manager for rap artist Eminem, has been settled after just five days of trials, the Associated Press reports. The suit, filed in July 2007 in U.S. District Court in Detroit, claimed Apple violated copyrights by allowing unauthorized sales of Eminem’s music. Although Aftermath Records has rights to the recordings, Eight Mile Style claimed that those rights did not allow the label to make a deal with Apple without its approval. A settlement was reached Thursday night, according to an Eight Mile Style attorney; no further details have been disclosed.
- October 1, 2009
Apple has quietly purchased mapping service Placebase and its accompanying Pushpin API, hinting that the company may be planning to use the assets should it need to replace Google Maps in several of its applications, such as the Maps application on the iPhone and iPod touch. Citing a Twitter update from the founder of openplaces.org, which used the Pushpin API in its software, along with an updated LinkedIn profile for Placebase CEO Jaron Waldman, who is now listed as part of the “Geo Team” at Apple, Computerworld reports that Apple purchased the company in July, and suggests that the company may be looking to replace Google Maps in its products in an effort to further reduce dependency on Google. Although Google Maps offers advanced features like Street View, Placebase offered a wide variety of customizations and features that integrated both public and private data sets, and the Pushpin API, which offered an easy way to layer data onto the maps. Despite the article’s strong suggestions, it is possible Apple purchased the company for reasons unrelated to its relationship with Google, such as bringing in more talent for development of more advanced map- and location-based services.
- September 29, 2009
Apple has hired Michael Tchao, one of the original developers of the Newton, as Vice President of product marketing, the New York Times reports. Apple spokesman Steve Dowling confirmed the hire, saying that Tchao will report to Phil Schiller, Apple’s Senior Vice President of Worldwide Product Marketing. Tchao left Apple roughly 15 years ago, and was most recently general manager of Nike’s Techlab, where he was responsible for the Nike+ product line, amongst other technologies. Although Tchao’s exact duties at Apple have yet to be revealed, the article suggests that he may oversee the marketing of Apple’s rumored tablet device, with one employee, speaking anonymously, saying, “[h]e’s got the scars and the great ideas” with regards to tablet computing.
- September 25, 2009
Apple has launched a retooled version of its website dealing with the company’s impact on the environment, alongside substantially more comprehensive reports into the company’s efforts to be more eco-friendly. Contained in the new reports is Apple’s estimate of its total carbon emission footprint, which Apple says is 10.2 million metric tons annually. According to a BusinessWeek report, this number is much higher than those of HP and Dell, who put their emissions at 8.4 million tons and 471,000 tons, respectively, but Apple’s report accounts for more areas than those of its competitors, including overseas manufacturing, company operations, and product use. Apple claims that consumer use of its products accounts for 53% of the company’s total emissions, compared to 38% for manufacturing, and 3% from its own operations. “A lot of companies publish how green their building is, but it doesn’t matter if you’re shipping millions of power-hungry products with toxic chemicals in them,” said Apple CEO Steve Jobs. “It’s like asking a cigarette company how green their office is.” Apple COO Tim Cook added, “We’re not being intellectually honest with ourselves if we don’t deal with the products that we make.”
In recent years, Apple has touted the strides it has taken in making its products more environmentally-friendly during major product introductions, and Jobs states in the BusinessWeek article that although the company was partially motivated by criticism from Greenpeace and other environmental watchdog organizations, he was also quite upset with them at the time. “I thought Greenpeace was being very unfair with us at the beginning, and that they were using us to get visibility,” Jobs said. “To have people saying we didn’t care and that we were callous in this area was very painful—and untrue.”
- September 18, 2009
Record label executives are concerned about Apple shifting its focus from music to iPhone and iPod touch applications, according to a BusinessWeek report. The article suggests that due to Apple’s role as the world’s largest music retailer and dominance of the U.S. with roughly 90% of digital downloads and a 74% share of the MP3 market, the labels are more dependent on Apple than before, while Apple’s core business is growing less dependent on music sales and more dependent on apps. “It’s no contest,” said Needham analyst Charles Wolf. “Apple’s strategic future is tied to the App Store. There is no strategic importance to music anymore.” The report comes just one week after Apple introduced iTunes LP, a new digital album format aimed at spurring sales of full-length albums as opposed to single downloads, at a special event; the company also spent time highlighting the gaming abilities of the iPod touch, and the video camera of the fifth-generation iPod nano. “Our biggest concern would be if they started resting on their laurels [in music],” an unnamed senior executive at a major label told BusinessWeek. “We need them to continue innovating.”
- September 15, 2009
Bruce Sewell, a former general counsel and senior vice president of Intel, will join Apple as the company’s General Counsel and senior vice president of Legal and Government Affairs, replacing Daniel Cooperman, who will be retiring at the end of September. Sewell will report directly to Apple CEO Steve Jobs, and will likely lead Apple’s legal, corporate affairs and corporate social responsibility programs, responsibilities he also held at Intel.
“We are thrilled to have Bruce join our executive team, and wish Dan a very happy retirement,” said Steve Jobs, Apple’s CEO. “With Bruce’s extensive experience in litigation, securities and intellectual property, we expect this to be a seamless transition.”
- September 9, 2009
Below is a complete transcript of iLounge’s live coverage from Apple’s Rock and Roll media event, held on September 9, 2009. Updates are presented in reverse chronological order; photos from the event can be seen on iLounge’s Flickr account.
- August 31, 2009
Apple has sent out invitations to select members of the media inviting them to a special event on September 9th. Featuring a large iPod silhouette graphic at the top sporting the phrase “It’s only rock and roll, but we like it,” the invite states that the event will be held at the Yerba Buena Center for the Arts Theater in San Francisco, CA, and that it will begin at 10:00 a.m. Pacific Time. Apple is widely expected to announce its fall 2009 iPod lineup at the event, and iLounge will be there to cover it live.
Notable is the “only rock and roll” reference, which appears to be a simultaneous dismissal of rumors that the event might be focused on more than just Apple’s “music” business—iPods—and a reference to the Rolling Stones, who traditionally were seen as rivals to The Beatles. The September 9 date of the event coincides with the release of The Beatles’ entire backcatalog in remastered CD format, as well as a widely publicized tie-up for a special Beatles version of the game Rock Band; these events, combined with Apple’s longstanding interest in offering The Beatles’ catalog in digital format on iTunes, have led many to speculate that the event would include such an announcement. If so, the theme of the invitation provides only the most modest hint that such a thing could be possible.
- August 31, 2009
The U.S. Securities & Exchange Commission has launched an investigation into possible illegal trading of Apple shares both domestically and abroad, according to a new report. Citing a series of SEC documents sent to the brokerage community, the Huffington Post reports that the commission is looking at four specific time periods, asking for the names of clients who specifically bought and sold Apple shares during those periods. The report states that the SEC is asking whether anyone had an illegal lead on how iPod sales were faring, whether anyone was given insight into Apple CEO Steve Jobs’ health, and whether anyone had exact knowledge of the dates on which company press releases or announcements relating to Jobs’ health and/or iPod sales would be made public.
- August 25, 2009
BTG International, a technology company based in Pennsylvania, has filed a complaint with the International Trade Commission alleging that Apple and a host of other companies unlawfully import and sell products containing patent infringing MLC flash memory chips, as well as the chips themselves. The complaint explains that BTG’s patents “relate to methods and apparatuses for programming and reading Flash memory cells that store more than a single bit of information per cell;” such chips are found in every current iPod and iPhone model, save for the iPod classic, and are typically manufactured by Samsung, according to the complaint. BTG filed a lawsuit against Samsung over the patent dispute in December of 2008, and filed suit against Apple and several other companies this July. BTG is requesting the Commission issue either a general or limited exclusion order aimed at stopping the importation of the chips and products containing the chips, as well as a cease and desist order directed to all the involved companies. Other companies named in the suit include Sony, RIM, Dell, Lenovo, and ASUS.
- August 20, 2009
Former Palm CEO Ed Colligan rejected what he deemed a “likely illegal” proposal from Apple CEO Steve Jobs that the two companies refrain from hiring each other’s employees, according to two-year-old communications between the two executives obtained and reviewed by Bloomberg News. While the report states that the exact details of what Jobs proposed are unknown since the proposal was not included in the documents it received, it did review Colligan’s response, which said, “Your proposal that we agree that neither company will hire the other’s employees, regardless of the individual’s desires, is not only wrong, it is likely illegal.” Colligan reportedly considered offering hiring concessions, before deciding against it.
The proposal appears to have been a direct result of Palm’s hiring of former Apple executive Jon Rubinstein to develop new products; Jobs was concerned that Rubinstein would recruit Apple employees away from the company to join his team at Palm—a rational fear, given that Apple had hired a number of Palm employees in the lead-up to the iPhone. “We must do whatever we can to stop this,” Jobs said. The U.S. Justice Department is investigating possible collusion in hiring practices amongst technology companies, and the Federal Trade Commission is currently looking into whether ties between Google and Apple through shared board members—including Google CEO Eric Schmidt, who recently resigned from Apple’s board—might have led to a similar arrangement, reducing competition between the two companies.
- August 13, 2009
A new Apple patent filing suggests the company is continuing its work on motion compensation for screens, particularly touchscreens as found on the iPhone and iPod touch. The patent, entitled “Motion Compensation for Screens,” describes a method of combining motion data, touch data, and screen properties to make devices easier to use when they’re in motion. Possible implementations could include temporarily increasing the size of selectable items on the screen, increasing the touch input region, and changing both the display and the input regions based on the motion of the device and motion of the selectable object, such as when swiping through pages of apps. A similar Apple patent filing appeared in April, and dealt primarily with scaling screen elements to make them easier to select when the device is in motion. As with all Apple patents, this filing does not necessarily represent any future product release from Apple, but offers evidence of the company’s research in this area. [via AppleInsider]
- August 3, 2009
Apple has announced that Dr. Eric Schimdt, CEO of Google, is resigning from Apple’s Board of Directors, on which he has served since 2006. “Eric has been an excellent Board member for Apple, investing his valuable time, talent, passion and wisdom to help make Apple successful,” said Steve Jobs, Apple’s CEO. “Unfortunately, as Google enters more of Apple’s core businesses, with Android and now Chrome OS, Eric’s effectiveness as an Apple Board member will be significantly diminished, since he will have to recuse himself from even larger portions of our meetings due to potential conflicts of interest. Therefore, we have mutually decided that now is the right time for Eric to resign his position on Apple’s Board.”
- July 23, 2009
Apple has withdrawn its threat of legal action against OdioWorks, which runs the BluWiki website. In April, OdioWorks representatives, with the help of the Electronic Frontier Foundation, sued Apple over threats made to the company over content hosted on the wiki. At issue was a group of “iTunesDB” pages that contained information on how to use an iPod or iPhone with third-party software. Apple legal sent a letter demanding the pages be removed, arguing that the content constituted copyright infringement and a violation of the Digital Millennium Copyright Act’s (DMCA’s) prohibition on circumventing copy protection measures. Following the receipt of a letter from Apple saying it was withdrawing its cease & desist demands and stating that “Apple no longer has, nor will it have in the future, any objection to the publication of the iTunesDB Pages,” the Electronic Frontier Foundation is dismissing its suit.
- July 21, 2009
In comments made during a conference call with analysts following the release of third-quarter 2009 financial results, Apple CFO Peter Oppenheimer noted that the company now views its iPod and iPhone business—“pocket products”—as comprising three segments: “traditional MP3 players,” “iPod touch,” and “iPhone,” and had internally forecasted year over year declines to occur in the traditional segment, one of the reasons the company developed the iPhone and iPod touch. “We expect decline to continue as we cannibalize ourselves” with the touchscreen devices, said Oppenheimer, though he noted that 50% of traditional iPod purchasers are people who are buying their first iPods, and suggested that these iPod models are not going away any time soon. According to Oppenheimer, unit sales declined in part based on reduction of channel inventory, as well as reduced sell-through of 4% year-over-year.
However, iPod touch sales grew “extremely well” in the quarter, representing 130% year over year growth, with the iPod continuing to have over 70% market share based on the latest NPD tracking information, and growth in nearly every territory it is being tracked in. iTunes sales of 8 billion songs were confirmed, with restatements of past figures: 1.5 billion downloads of Apps and 65,000 applications in the App Store. iPod touch sales are expected to grow considerably in the future.
Though Apple would not break out specific numbers on sales of the iPod touch and iPhone, COO Tim Cook noted: “As we made the changes, both the launch of the 3GS and the price reduction of the 3G, we saw a significant acceleration of total unit sales… as Peter alluded to, the iPhone 3GS is currently [supply] constrained in virtually every country we’re shipping in, so the demand for it is very robust.” Regarding sales to the corporate world, Cook said that interest is growing, in part due to the 3GS’s new hardware encryption and security features, and noted that almost 20% of the Fortune 100 have purchased 10,000 or more iPhone units, as have multiple government agencies.
The executives said that the App Store is now available in 77 countries and now reaches over 45 million total iPhone and iPod touch users. Apple is also looking to expand iPhone distribution within currently available countries where it makes sense to do so, and expand past the iPhone’s current 80 countries, including large ones. Notably, they had nothing to add on the situation regarding the iPhone in China, beyond the fact that it continues to be a priority and they hope to have the device available there within a year. The company also admitted that it is a “beginner” in markets where pre-paid phones dominate the market, saying that there are some opportunities available there, and that a “good” number of iPod touch users had upgraded to version 3.0. Finally, when asked about the movement towards $0.99 pricing in the App Store, Cook and Oppenheimer said that the company does have some ideas on how to improve the store experience, and they realize there is room for improvement, but that the developers set the price themselves, and are doing “good business” when deciding where best to set their prices.