- May 10, 2005
The Detroit News reports that the record label of Eminem has agreed to an undisclosed financial settlement in its lawsuit over the use of one of the rapper’s songs in an Apple ad that appeared on MTV. “The parties were able to reach an amicable resolution,” said Howard Hertz, lawyer for Eight Mile Style and Eminem.
The commercial for the iTunes Music Store featured a young boy singing Eminem’s “Lose Yourself” and aired on MTV beginning in July 2003. In February 2004, Eight Mile Style filed a copyright infringement lawsuit against Apple, MTV and others claiming that Apple used the hit song without permission. Eminem’s lawyers said at the time that “even if he were interested in endorsing a product, any endorsement deal would require a significant amount of money, possibly in excess of $10 million.”
- April 21, 2005
At Apple’s annual shareholders meeting Thursday, chief executive Steve Jobs defended his company’s environmental efforts after being questioned about recycling policies.
While activists picketed outside Apple headquarters, Jobs said inside that the company takes its environmental responsibilities seriously and noted that the company accepted more than 1,500 tons of old products in 2004 through its recycling program.
The activists — including one who dressed up as an iPod with the words “My trendy toy turned toxic trash today” — focused on the iPod and the device’s hard-to-replace battery. “Most consumers are just going to throw it away and get a new one,” said Sheila Davis, director of the Silicon Valley Toxics Coalition.
Jobs said that consumers often throw old batteries away, and pointed out that tens of thousands of iPod owners have already gotten their batteries replaced through Apple’s $99 program and that the company properly disposes of the old ones.
Jobs also admitted that the iPod contains a small amount of lead, but that much more is found in other computer and conusmer electronics products including cathode-ray tube (CRT) monitors.
- April 13, 2005
Reporting its fiscal 2005 second quarter financial results on Wednesday, Apple announced that it shipped more than 5.3 million iPods during the quarter — about 700,000 more than it shipped in the brisk holiday quarter and about 4.5 million more than it did in the year-ago quarter. The total number of iPods sold now stands at over 15 million.
Apple’s net profit for the quarter was $290 million, or 34 cents per share, on $3.24 billion in revenue. These results compare to a profit of $46 million, or 6 cents a share, last year.
“We are delighted to report a record second quarter for Apple in both revenue and earnings,” said Apple CEO Steve Jobs. “Apple is firing on all cylinders and we have some incredible new products in the pipeline for the coming year, starting with Mac OS X Tiger later this month.”
Apple said its music products accounted for 38 percent of its total revenue for the quarter. All iPod models brought in more than $1.014 billion in revenue for Apple during the quarter, an increase of 284 percent in revenue. Apple’s “Other Music Products” category, which includes the iTunes Music Store, iPod related services and accessories, accounted for $216 million of the quarter’s revenue, a 260 percent increase year-over-year.
- March 15, 2005
Apple’s Steve Jobs again received a salary of $1 in 2004, according to an annual proxy statement filed Tuesday with the Securities and Exchange Commission. Jobs also did not receive stock options or restricted stock from Apple last year. “For years, Jobs, who co-founded Cupertino, California-based Apple, has taken a salary of $1,” reports Reuters. “In March 2003, Jobs voluntarily canceled all of his outstanding options, excluding those granted to him in his capacity as director.” Jobs is Apple’s second-largest shareholder, with more than 10 million shares, or 1.23 percent of the company’s outstanding share count, according to Marketwatch.
- March 11, 2005
“I am currently working on a project for Apple.
We are looking to speak with people who have come to Mac through owning an iPod. These are people who have been or currently are PC users; they own an iPod and love it so much that they’ve bought a Mac.
Specifically we are looking for people between the ages of 14-35…young professionals, parents, students/etc…approachable, real people. I would like to speak with anyone who fits this description.”
- March 5, 2005
Apple has recently been confronted by two companies that say Apple is infringing on their patents with its popular iTunes and iPod products.
A Hong Kong-based company called Pat-rights claims its holds a patent on the digital rights management (DRM) process that Apple uses in the iTunes Music Store and iPod. The company is demanding 12 percent of Apple’s gross revenue from iTunes and iPods. Pat-rights said it will file a lawsuit on March 21 if the company and Apple do not reach an agreement before then.
Meanwhile, Illinois-based Advanced Audio Devices, has reportedly sued Apple, claiming that the company’s iPod violates one of its patents. A Chicago Tribune article is scant on details, but the paper does say that Advanced Audio told Apple in December that the iPod infringed on its “Music Jukebox” patent. Apple “ignored [Advanced Audio’s] attempt to seek a business resolution,” the federal suit said.
- February 14, 2005
A French consumer group has sued Apple and Sony, claiming their online music stores violate European anti-trust laws. The Register reports: “Like California resident Thomas Slattery, who filed a similar complaint against Apple in January, Paris-based UFC-Que Choisir claims that Apple’s iTunes Music Store and Sony’s Connect service are anti-competitive because they only work with the companies’ own music players.”
“Apple can also argue that the French government’s anti-trust watchdog has already ruled that it has a right to maintain a proprietary link between its music store and the iPod. Last November, the watchdog dismissed an attempt by Virgin’s French retail subsidiary, VirginMega, to force Apple to license the Mac maker’s FairPlay DRM technology, which would be essential to allow any third-party device to play iTMS-downloaded songs.”
- February 11, 2005
Apple on Friday announced that its board of directors has approved a two-for-one stock split that will increase the number of authorized common shares to 1.8 billion from 900 million. Apple said that each shareholder at the close of business on Feb. 18, 2005 will receive one additional share of stock for every share they own. Trading will begin on a split-adjusted basis on Feb. 28, 2005.
Shares of Apple have nearly quadrupled in value over the last year on the success of the iPod. Last month, the company easily beat analysts’ expectations with its first quarter financial results. Apple posted a net profit of $295 million, or 70 cents a share, compared to income of $63 million, or 17 cents per share, in the prior year. Analysts surveyed by Thomson First Call had expected the company to earn 49 cents a share.
Apple stock closed Thursday’s session down 38 cents at $78.36. It reached a 52-week high of $81.99 on Wednesday.
- February 7, 2005
In an interview with Fortune, Apple CEO Steve Jobs answers the question of how the iPod has changed Apple. “It feels great,” Jobs says. “We’re having fun. Most of us can’t wait to get to work in the morning. But it’s not like Apple has somehow morphed into a mass-market consumer electronics company. Our DNA hasn’t changed. It’s that mass-market consumer electronics is turning into Apple.”
Jobs also discusses how young people are migrating to iPods and matching portable speakers from larger stereos made by electronics giants.
“You or I move into a new house, and the first thing we do is call the phone company to get our land line turned on. Kids, they just move in with their cell phones. Stereos are the same: Kids aren’t getting stereos; they’re getting speakers for their iPods,” Jobs says. “That’s become the audio market. People are buying iPods and Bose speakers instead of a JVC or Sony stereo system. And those guys have never come to us and said, ‘Could we work with you on the iPod?’ Some companies are prisoners of their point of view.”
- January 30, 2005
Apple has been named the most influential brand in a poll of branding professionals thanks to its hugely popular iPod product line. Apple topped both the global and North American rankings in the survey of nearly 2,000 ad executives, brand managers and academics by Brandchannel, displacing search engine Google from last year’s top spot.
“Apple’s just done an extraordinary job with innovation, technology and design. The iPod is what has put Apple in the lead this year,” Brandchannel editor Robin Rusch said. “Sony has had less luck tying together its products as a lifestyle. From a branding perspective, they haven’t caught up with Apple’s design and ability to capture the imagination.”
Rounding out the top five were: Swedish furniture chain Ikea, premium coffee chain Starbucks, and Arabic media channel Al Jazeera.
- January 25, 2005
Apple is looking for two interns for its iPod software team, according to new postings on the company’s jobs site. “The iPod SW Platform team is seeking an enthusiastic intern. This position requires a self-motivated, flexible individual with strong technical and communication skills who can contribute in a team environment.” Apple said duties may include: development of testing tools and automated testing solutions; prototyping new features and capabilities; bug isolation and reporting; and writing and managing test cases.
- January 16, 2005
Speaking with iLounge at last week’s Macworld Expo in San Francisco, Apple representatives noted that the company has posted new tutorials for the iPod, iPod mini, and iPod shuffle on its web site. In addition to being visually attractive, the tutorials have become increasingly useful and easy to understand.
- January 12, 2005
Apple on Wednesday posted its highest quarterly revenue and net income in the company’s history thanks to strong holiday sales of iPods. Apple greatly exceeded Wall Street expectations with a net profit of $295 million, or 70 cents a share, for its fiscal 2005 first quarter ended December 25, 2004. Revenue for the quarter was $3.49 billion, up 74 percent from $2 billion in the year-ago quarter.
Along with its record earnings, Apple released several iPod and music sales details. The company reported that it sold more than 4,580,000 iPods during the quarter, representing a 525 percent increase in iPod units compared to this time last year. All iPod models brought in more than $1.2 billion in revenue for Apple during the quarter. Apple’s music division, which includes the iTunes Music Store, iPod services and accessories, accounted for $177 million of the first-quarter’s revenue, a 277 percent increase year-over-year.
Apparently in response to the release of these financial results, Apple’s stock (Nasdaq: AAPL) is up an impressive 11.82% to 73.20 in after-hours trading.
- January 7, 2005
Forbes senior editor Lisa DiCarlo and Boston attorney Bruce Sunstein have spoken out on Apple’s recent lawsuit against Mac rumor site Think Secret, which has recently posted reports on upcoming Apple products such as a low-cost iMac, a productivity suite, and a flash-based iPod. “It is widely acknowledged that Apple enjoys the kind of slavish devotion among its customers—and fawning adoration from the press—of which other companies don’t even dare to dream,” writes DiCarlo. “That is, it’s acknowledged by everyone but Apple. How else to explain Apple’s latest attempt to clamp down on, rather than embrace, its fanatical fans?” Sunstein, who specializes in intellectual property law, said the case will only result in damage to Apple’s reputation. “A fair amount of buzz doesn’t hurt Apple’s business,” he said. “And, to the extent that Apple sues its customer base; it has to think twice about biting the hand that feeds it.”
- January 5, 2005
A displeased customer of Apple’s iTunes Music Store is suing the company, alleging it broke antitrust laws by allowing songs purchased from the store to only work with the iPod, shutting out competitors. “The suit was filed on Monday in the U.S. District Court in San Jose,” reports Reuters. “One antitrust expert called it a long shot, but Californian Thomas Slattery is hoping for unspecified damages for being ‘forced’ to buy an iPod. The key to such a lawsuit would be convincing a court that a single product brand like iTunes is a market in itself separate from the rest of the online music market, according to Ernest Gellhorn, an antitrust law professor at George Mason University. There is legal precedent for such claims, but courts usually conclude competing products as viable alternatives, Gellhorn said.”
- December 17, 2004
Apple is suing unnamed individuals who leaked details about an unannounced product by posting detailed information on the Web. Apple’s complaint, which was filed with the Santa Clara County California Superior Court on Dec. 13, alleges that “an unidentified individual, acting alone or in concert with others, has recently misappropriated and disseminated through Web sites confidential information about an unreleased Apple product.” Apple said it did not know the “true names or capacities, whether individual, associate, corporate or otherwise,” of the defendants, but that it would amend the complaint once they have been discovered.
- December 16, 2004
Apple and Motorola could soon unveil the mobile phone they have been developing to play music from Apple’s iTunes Music Store. “We’ve said we have something coming on this in the first half of 2005 and we’re definitely on schedule for that. Hopefully you’ll be able to see more about it soon,” Eddy Cue, vice president of applications at Apple, told Forbes. “What we’ve talked about is a something that is valuable for the mass market,” Cue said. “It has to be a phone in the middle-tier of the market, not a $500-tier phone. It has to be very seamless to use. And we’re very happy with the results.”
- November 22, 2004
In addition to raising his price target on Apple stock to $65 from $53, Fulcrum Global Partners analyst Robert Cihra increased his estimates on iPod sales in Apple’s current quarter to 4 million from 2.9 million. Cihra also said that the iPod would account for 33 percent of the quarter’s revenue, up from 13 percent a year ago. Earlier today, Piper Jaffray raised its price target on Apple to $100 from $52, citing a definite “halo effect” among iPod owners.
- November 22, 2004
Piper Jaffray raised its target price on Apple stock to $100 from $52, citing a “halo effect” from satisfied iPod users. The firm said that in a survey of 200 users, 6 percent were former PC users who have purchased a Mac after becoming an iPod owner, while 7 percent were former PC users who plan to buy a Mac within the next 12 months. “We believe that the remarkable satisfaction with the iPod creates a word-of-mouth wildfire that generates new customer interest in Apple products,” Piper Jaffray said.
- November 15, 2004
While Apple CEO Steve Jobs calls the iPod the “Walkman of the 21st century,” Microsoft and its allies are hoping to make it the Betamax of the 21st century, according to a report in the New York Times. “The iPod dominates its market in a way that no Apple product has done in a generation, raising the possibility that the company is becoming more than just a purveyor of computers with high design and low market share. If Apple continues to ride the wave of consumer electronics products, it may become the Sony of the 21st century. For that to happen, however, Jobs must do what he failed to do last time: prevail over his old nemesis, Bill Gates, who sees entertainment as Microsoft’s next great frontier. Microsoft is working hard to make sure that the iPod is less like the Walkman and more like the Betamax, Sony’s videocassette format that was defeated in the marketplace by VHS.”