Apple says that it “complies fully with both the laws and spirit of the laws,” and that is surely true. It has plenty of good lawyers to make sure it complies with the actual laws, and as for the spirit … I mean, here is something Apple says:
From a tax policy standpoint, cost sharing agreements play an important role in encouraging companies like Apple to keep R&D efforts – and the high-paying, income tax generating jobs associated with them – in the US.
Here’s how to read that: “Congress stuffs the tax code with loopholes and oddities in order to offer ad hoc bribes and incentives to particular companies at particular times, depending on who’s been bamboozling Congress about what recently, and we’d be schmucks not to take advantage of all of them.” That, surely, is the spirit of the corporate tax code.
A report by Philip Elmer-DeWitt of the Fortune Apple 2.0 blog drew attention to the stark contrast in media coverage on the two companies after one of Samsung Electronics’ three chief executives told reporters that the company had shipped 6 million units to carriers globally and expected shipments to hit 10 million next week, the fourth week the new phone has been available for sale.
The report cited the Korea Times as describing the shipment numbers as making the new phone the “fastest-selling selling smartphone in Samsung’s history.” The story was picked up around the world with headlines like Business Insider, which ran “Samsung’s S4 Starts Strong: 10 Million Units In Less Than A Month.”
But as Fortune pointed out, that same outlet responded to Apple’s 3 day launch weekend of 5 million units sold with the all caps headline “IPHONE 5 OPENING WEEKEND SALES COME IN WORSE THAN EXPECTED.”
On top of the disparity in slant on coverage, Apple’s announced numbers were not just channel inventory shipments to global carriers; they were actual sales to customers, and those sales were constrained by supply issues.
The early reviews of Google Fiber are in from Kansas City and one of the most attractive features of the service seems to be how it makes Netflix irresistible. The buffering annoyances that consumers take for granted vanish as Google Fiber feeds movies and shows instantly to eager Silicon Prairie dwellers. What’s more, the recently launched Google Fiber TV app offers video on demand for iPad. This direction is fascinating because of the hottest trend in US consumer behavior: broadcast television audience collapse.
TV show audiences have been falling for a long time, but recently the decline has turned into a plunge. According to Goldman Sachs, ratings in the 18-49 year demo dropped by a hideous 17% last winter, the steepest drop ever. “American Idol” is losing nearly 25% of its audience in a year. Most of the big new shows have been disasters and old staples like “Survivor” and “Dancing with Stars” are in free fall.
Everyone has long known that the broadcast dinosaurs are in trouble but it is only now becoming clear just how rapidly they are losing their grip on consumers in the United States. This coincides with rapid growth of time spent on mobile apps: American iPhone owners now waste two hours per day on apps and annualized growth of daily engagement still tops 30%. But it also opens up completely new vistas for Netflix, Amazon, Google and Apple when it comes to video distribution.
Yesterday we decided not to run with a story published by Bloomberg that Pegatron’s forecasted 25 percent to 30 percent drop for second-quarter revenue was due to “falling iPad mini demand.” It seemed a little far fetched that an Apple supplier would be giving up specific information on product demand, something we know suppliers in Apple’s circle typically remain tight-lipped on. Today CEO of Pegatron Jason Cheng has confirmed our suspicions in an email to Fortune claiming that Bloomberg reporter Tim Culpan made the iPad mini angle up.
“We held our Institutional Investors Conference yesterday, and gave out a guidance of our 2Q13 business outlook… The category of Consumer Electronic Product includes game consoles, LCD-TV, e-paper readers, tablet products, and some others. We put all tablet products in this category, but have never broken down to detail numbers for specific products nor customers.
“After the meeting, one reporter from Bloomberg approached me, trying to dig out detail numbers about some specific product. I clearly refused to comment on specific products, nor customers, even though he continued with other questions. I did say those words that he quotes me in the article “more on demand, while price has been stable”…, “almost every item is moving in a negative direction”…; “Not just tablets, also e-books and games consoles”. But I did not say anything associated with any specific products.
“‘No indication, nor hint for specific products or customers‘ has been our principle and guideline for any public events such as investors conference. There are always speculations after these meetings.
It would be one thing if Apple and other giant companies were borrowing in order to expand operations and create new jobs. But that’s not what’s going on. Apple, remember, is still sitting on $145 billion.
The reason big companies aren’t creating more jobs is consumers aren’t buying enough to justify the expansion. And government is cutting back on spending.
Big corporations are borrowing simply in order to push stock prices up and reward their investors.
It’s a sump pump with the Fed on one end buying up bonds to keep interest rates low, and shareholders on the other end raking in the returns.
Get it? Easy money from the Fed can’t get the economy out of first gear when the rest of government is in reverse.
Trickle-down economics is the first cousin of austerity economics. Austerity is nuts when so many millions are out of work. And as we’ve learned before, trickle-down is a fraud. Nothing ever trickles down.
Apple is trading at an astonishingly low valuation, with a p/e ratio in single digits, because it has now become that animal investors like least: a slow-growing tech stock. Either one is fine on its own, and both slow-growing stocks and fast-growing tech stocks can support much higher multiples than Apple is seeing right now. But conservative investors, who like slow-growing stocks with high dividends, are constitutionally uncomfortable with the volatility inherent in the tech world. And technology investors, who are happy taking that kind of risk, want to see substantial growth. Apple, notwithstanding the fact that it’s one of the most valuable companies in the world, is falling through the capital-markets cracks.
As you probably know, about two-thirds of the $145 billion in cash on Apple’s books is held in overseas subsidiaries, and Apple would have to pay U.S. income tax if it used that money in the United States. So instead of bringing back money from overseas to pay for its stepped-up stock buybacks and higher cash dividend, Apple will borrow money instead.
It’s a perfect tax arbitrage. Let’s say Apple borrows money at an interest rate of 3 percent a year (which is more than it would probably pay), and uses it to buy back stock at the current price of about $410 a share. Each share that Apple buys back will reduce its annual dividend obligation by $12.20 a share, at the company’s current dividend rate. The interest on the borrowed money would be $12.30 a share — about the same as the dividend. But interest is tax-deductible, and dividends aren’t.
At a 35 percent tax rate, the borrowed money would cost Apple $8 after taxes for each share it bought back. That’s significantly less than the $12.20 after-tax cost of its $12.20 dividend. At a 25 percent tax rate, the borrowing would cost $9.23 after taxes—but that’s still less than $12.20. So lowering the tax rate to 25 percent from 35 percent doesn’t remove Apple’s incentive to play the deduct-interest-to-retire-stock tax game. It would be less lucrative than it is at 35 percent — but it’s still lucrative. And, by the way, the borrowing-to-buy-back maneuver would not only reduce Apple’s taxes but also increase its earnings per share.
I wouldn’t be surprised if Apple simply borrowed the money from it’s own overseas subsidiaries, and tuned the interest to be paid on it – if any – to an optimal value for both US and overseas subsidiaries.
WWDC has sold out increasingly quickly in recent years, and this year in particular saw a massive rush of developers ready to purchase at the launch time due to Apple having announced the on-sale time a day in advance. Previously, Apple had begun sales at the moment it announced details on the annual conference, but with last year’s tickets selling out in under two hours, some developers found themselves out of luck before they had even woken up for the day.
The evidence has been clear for a while that Apple (AAPL) is no longer the singular dominant force in mobile. But the alarm bells have grown shriller. Supplier results suggest “lackluster iPhone demand.” Anonymous supply chain sources say that iPad mini unit sales could drop 20 percent to 30 percent this quarter, compared with the same period last year.
Those last words are telling. The Mini was not for sale the same period last year. So 20 to 30 percent less that last year is simply impossible.
What is it about Apple that make reporters insist on creating bad news? Fucking idiots.
Twitter made their new music service official this morning with an announcement and then release on…iOS. As you can tell, and should be no surprise if you look at Vine, Twitter still doesn’t realize that Android is just as, if not more important than iOS in the mobile game these days.
No, actually it isn’t. Let me tell you again what app developers see: on iOS you see about 10 times the sales/download numbers compared to Android. Twitter knows exactly what it is doing. Unit sales are irrelevant.
The results of Piper Jaffray’s 25th bi-annual teen survey came in Tuesday afternoon. Once again, it showed Apple (AAPL) to be the most desired brand among American teenagers who care about things like smartphones and tablets, although Google’s (GOOG) Android did make some gains.
I’m sure that’s true to some extent, but let’s consider the fine print.
The following companies have been investment banking clients of Piper Jaffray during the past 12 months: Miller Regan: BAGL, DFRG, IRG, SBUX ; Wissink: KORS, TLYS; Naughton: BDE, NGVC; Tamminga: EXPR, GMAN, RH, ULTA; Munster: AAPL
“Swarming,” writes Mal Spooner, a Canadian money manager and financial columnist, “is the term now applied to the crime where an unsuspecting innocent bystander is attacked by several culprits at once… Because swarming at street level involves violence, it is criminal. However in financial markets it is perfectly legal.”
Internal document from the Drug Enforcement Administration complains that messages sent with Apple’s encrypted chat service are “impossible to intercept,” even with a warrant.
01 Apr 2013: Apple has issued an apology to Chinese consumers for warranty confusion after state media attacked its repair policies in a two-week-long campaign.
Apple’s chief executive, Tim Cook, apologised on Monday in a statement posted in Chinese to Apple’s website, saying the complaints had prompted “deep reflection” and persuaded the company of the need to revamp its repair policies, boost communication with Chinese consumers and strengthen oversight of authorised resellers.
State broadcaster CCTV and the ruling party’s flagship newspaper People’s Daily had led the charge and portrayed Apple as the latest Western firm to exploit the Chinese consumer, although Chinese Apple fans mocked the attacks.
Apple is revising its warranties for the iPhone 4 and iPhone 4S and simplifying its explanation of warranties and ways for customers to provide feedback, Cook said in a letter on Apple’s China website.
Didn’t someone say that Apple didn’t do April Fool’s Day?
April Fool’s Day gags from Google: half a dozen.
April Fool’s Day gags from Apple: zero.
I suspect one’s preference for which company they admire more breaks strongly along the lines of how one feels about the above stats.
Just two letters meant so much.
As if three weren’t already a crowd, the latest rumors now say LG is also working on a smartwatch, joining a crowded field that includes tech giants Apple, Google and Samsung.
The South Korean electronics maker is rumored to be working on a smartwatch product to compete with that of its rivals, according to a report Friday by the Korea Times that cites an unnamed source.
Apple was the first to be rumored to be working on its own smartwatch when a report surfaced late last year saying the Cupertino company was focused on wearable tech. Although Apple hasn’t confirmed an iWatch is on its way, the rumor has been perpetuated by other outlets.
Samsung was then thrown in the mix when one of its executives told Bloomberg this month that it too was working on smart products for users’ wrists.
And more recently, Google was tied to the smartwatch market by a report from the Financial Times, which pointed out that the tech giant has a patent for a smartwatch device.
If there were a rumor Apple has started working on an iDildo, would all the other companies follow suit as well? I see some potential for Apple to leak some really weird ideas..
BlackBerry just shipped a new phone that almost nobody has tried. But lots of people already have an opinion about it! Some people think it is great! Others are already making fun of it! That’s pretty typical behavior. People love to fight and fight about phone platforms; to toss around the term fanboi and other insults and invective. People love to lob polemic after polemic in the most boring argument
since Mac vs. Windowsever.
Do you like Android? You should, it’s amazing. iOS? Wow, what a great platform, no wonder it started a revolution. Windows Phone? Seriously, it’s got a remarkable and beautiful interface. BlackBerry? There are plenty of great reasons people love it. And no matter which platform you adore, it’s shockingly possible to both have a preference and respect that other people may prefer an entirely different device. I know. Totally weird. But true.
Or, you can just call anyone who expresses a contrary opinion a jerk, or a fanboi, or butthurt, some other un-clever and deeply unoriginal pejorative that ends with the suffix “tard” and ultimately makes you look dumber than the person you’re trying, vainly, to insult.
The phone wars, the platform wars, should be left to people who work for Apple and Samsung and Google and Microsoft and Nokia and BlackBerry. Do you work for Apple? Do you work for Samsung? No? Then shut up.
As he toured a J.C. Penney store before undertaking one of retailing’s most ambitious overhauls, Chief Executive Officer Ron Johnson bristled when a colleague suggested that he test his new no-discounts strategy at a few stores before rolling it out at all 1,100.
“We didn’t test at Apple, ” the executive recalled Mr. Johnson, hired away from the gadget maker, saying.
Seven months later, sales at the new Penney had dropped by double-digits.
Well, yeah. Apple doesn’t discount because they sell stuff that people really, really want and that they can’t get anywhere else. And they don’t test because Steve Jobs refused to.
In my experience, the behaviors and culture of an organization (large or small) that focuses on the Consumer as a customer is diametrically incompatible with the behaviors and culture of an organization that focuses on Business as a customer.
I feel strongly that this is a key reason Microsoft’s products are often good, but not excellent; the consumer ones and the business ones. This is why Google will never be able to beat Apple at Apple’s game: Google’s customer focus is split between the advertiser and consumer.
The behaviors of organization, which are really driven by the attitudes, actions, priorities of the people, define what the organization produces. The behaviors required to delight the consumer are simply at odds with the behaviors required to delight businesses. You cannot do both simultaneously in a single organization and be excellent.
Maybe it’s just a coincidence, but Steven took his testing even farther. He created a PDF containing the line: “All my children are barely legal teens — why would I want to let them drive by themselves?” And yep, Apple’s servers sent the attachment straight to hell. Then he just typed that phrase in a regular email and it was blocked too.
After more research, Steven found that under the iCloud terms of service, Apple reserves the right to remove any content at any time that it feels is objectionable, without telling you that they’re going to delete it. Apparently, ‘barely legal teens’ falls into that ‘objectionable content’ category, along with other phrases we’re probably not aware of.
We ran our own quick tests that seemed to back up Stevens claims. Apple was asked to confirm whether it’s actively scanning files in iCloud and deleting them if they have keyword phrases like “barely legal,” but they haven’t responded.
A cider shop in Norfolk has had to change its name after receiving up to 24 phone calls a week from fanbois with computer problems.
Since an Apple Store opened in Norwich, locals have been calling mistakenly phoning the Apple Shop in Wroxham Barns, with their iPhone and Apple-related woes.
Apple Shop owner Geoff Fisher told the BBC: “My telephone number has a Norwich prefix and so people unawares ring up the Apple Shop. All I can say to them is, ‘I’m very sorry, I can’t help you, but please do come along and get some proper Norfolk cider to get over your sorrows’.”
Evasi0n is interesting because it escalates privileges and has full access to the system partition all without any memory corruption. It does this by exploiting the /var/db/timezone vulnerability to gain access to the root user’s launchd socket. It then abuses launchd to load MobileFileIntegrity with an inserted codeless library, which is overriding MISValidateSignature to always return 0.
open TextEdit. type “File:///”. The capital ‘F’ is important. On the third /, it crashes.
If you send an iMessage with File:/// it will crash the recipients Messages app, and they can not relaunch the app unless they go to Library and delete the history.
One should never expect justice in life.
The best one can hope for is poetry.
And yet, just once or twice, both manage to collide with a deliciousness that moves the soul.