Tuesday, 2 April 2013

What now for the mighty Apple - where is the next iLlusion? By One Writer and his Blog

The apple, throughout history, has traditionally represented that which is forbidden. The forbidden fruit, with which Adam was tempted out of the Garden of Eden thus marking a dramatic fall from grace that is now associated with something else. Apple, the technology behemoth, has been tempting us far too successfully for years, under the leadership of its former CEO and mighty magician, Steve Jobs,  and now itself seems to have fallen from grace.

Credit: phonearena.com

“So what now for Apple?” is the question on everyone's lips. Without their master magician to pull the proverbial rabbit out of the hat, the company seems to be floundering. Not so I say! My previous calls for a dividend (made well before Einhorn and others filed their suit) were clearly heard, or so I would like to think, and Apple may soon have one of the highest dividends for any major corporation in the US.

This is a start, something that investors have been looking forward to, and rightly so. However, it seems to me that the consumers, who drive the ungodly margins, and hence profits, are being left out of the equation with no “bang for their buck.”

In fact, the clamour of calls for something new has reached cacophonic proportions with many pundits and analysts predicting a mass move to other makers. Blasphemous as this may sound to the followers of the Magician, fear not. He may not be there, but his gang are well versed in making exceptional products (Ive, Cook et al have been at the Magician's side for years and things do have a tendency to rub off) as can be clearly seen by the money-printing machine that Apple has become, in spite of the loss of their leader.

So where are they going? Will it be a watch or an iLlusion? How long will the cash pile last and will they be able to innovate their way out of the current creative coma? These are the questions on everyone's lips.

Credit: The Tech Stock Blog

And here are the answers

There is definitely a product in the pipeline, all the rumours allude to it and we all know that there is no smoke without fire. Moreover, the share price also hints at it (if you are an active player then I suggest taking advantage of the old adage, "buy on the rumour and sell on the news").

However, I am willing to bet on the fact that it is not just a hardware leap. We have heard of extra cores, speed and memory of the latest phones. However, what will, in my humble view, differentiate products from now on is the software side. It has become a software game and Android is fast playing catch up with the industry wide benchmark, Apple. The leap will undoubtedly be on the software stage, which is now the more important side of the equation. Faster browsing, ease of access to the hundreds of apps that one has on one’s phone, software to control important functions and something more appropriate than looking like a freak commanding your phone are the things that are needed.

The good and the great say a watch, hmmmm, more colours, or even a cheaper model. Good but not good enough I say. Raise your game Apple, focus on the software and you will get the young buying again in droves. Pander to the new human need to have something more than just new and shiny, as we are way past that phase. This is your one chance, otherwise the cash pile will diminish and no number of dividend increases and preferred stock issuances will save the slow and painful decline that we have seen others face in your wake.

Copyright 2013 "One Writer and his Blog"

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