from October 2012, News
In his latest hack-fest column titled "Here's a New Report On Why Apple Decided To Overcharge For The iPad Mini" Henry Blodget asserts Apple has overcharged for the iPad Mini because:
- Apple can charge this much--its fans are either so brainwashed or so locked-in to Apple's ecosystem that they'll pay anything
- Apple wants to protect its extraordinarily high profit margin
- Apple's "mini" is better than the Google and Amazon tablets
On October 23rd Apple CEO Tim Cook will most likely unveil the long-awaited iPad Mini. While this new product will most likely expand Apple's dominance in the tablet market there is something more important happening on the 23rd.
This event marks Tim Cook's fourth time making a presentation as Apple's CEO announcing a major new product. There was the:
Apple announced to select media an October 23rd, Special Event with the comment "We've got a little more to show you". However, Apple wont' be holding the event on the Cupertino campus, nor will the event take place at the Buena Vista Performing Arts Center in San Francisco. Apple has instead chosen a larger auditorium, the California Theatre in San Jose.
Jeff Bezos desires to become the next Steve Jobs. He is quickly moving his company, Amazon, down a path that is competing directly with Apple. The first step was to create the Kindle book reader. At first, the Kindle didn’t compete directly with Apple, but it did turn Amazon from just a retailer into a hardware manufacturer and a retail company. The Kindle Fire, a seven inch LCD tablet was a big step in Apple’s direction. Amazon has continued to improve their Kindle inline up with annual updates, but they are not done yet.
Amazon is now looking into improving its hardware development side. A clear sign of this is news they are wanting to buy TI’s mobile chip division. Right now, Amazon relies on outside help for much of its hardware designs. This purchase would change that and owning a chip designer division would be a big step into the hardware world. It would be a major sign that Amazon is bringing hardware design in-house and making it an important part of the company. This may be Amazon’s first hardware purchase, but it won’t be its last.
Microsoft continues their Windows 8 hype, while iOS 6 has just launched, while Google has any number of Android versions floating around from which hardware vendors may choose. With Microsoft about to launch their tablet a battle for ecosystems is brewing in full, but Apple has a sizeable edge over their largest competitors with a near complete ecosystem.
No one questions Steve Jobs' extreme pursuit of perfection. And even though he's been gone for a full year now, Apple's 5th Avenue store in Manhattan only serves his devotion to detail in many areas. Jobs work underscored how futile it is other companies in the technology field to devote fain attention in believing they can top Apple at their own game.
For the past four years Apple's profit margins have continued improve while mystifying the experts. In March 2008, Apple reported a 13.9% profit margin for the quarter. Now compare that to the March 2012 quarter where Apple reported a 29.6% profit margin. It seems nearly impossible with increasing competition that is specifically targeting Apple, and with pricing pressures at every turn, that Apple can continually grow its profit margin.
To make matters worse China often boosts their minimum wage rate by 30% at a time. In fact, China has done this numerous times during the last decade. So how has Apple been able to continue to grow its margins?
Microsoft is looking at making a big investment in MSN so they can turn it into a real media operation. While it might be only a news aggregator like Reuters or AP, Microsoft is looking at hiring some journalists as well.
Version 8 of Microsoft's top product, Windows, is expected to be launching soon. Most of Microsoft's money comes from either Windows or their Office products. Will an investment into a media operation increase sales of these products?