I watch Apple stock closely because I’m a shareholder. I’ve been waiting for that iPhone bump, and it happened today. Although the small bump was only regaining some ground we lost a few weeks ago. And we’re still a few dollars a share short of the 52-week high…
Hundreds of thousands stood in line over the weekend to be among the first to get their iPhone. In all, over 500,000 were sold, and the next batch of phones won’t come for a few weeks.
Some users of the iPhone got some bad news. They found out quickly that without activating cell phone service, the phone was essentially useless. You can’t even play with most of the cool features unless it’s activated.
So they tried to activate their phones. Some were lucky. Others couldn’t get through, as the AT&T network was jammed with people activating their iPhones. (AT&T is the only carrier that works with the iPhone.) Then there were those who got through, only to find out that they couldn’t transfer their current phone number to the iPhone. You thought cell numbers were portable? Well, sort of. Only within metro areas… so if you got your original phone number in one city, and move to another city but want to keep that number and transfer it to the iPhone, you’re out of luck.
Apple expects to sell 10 million iPhones by the end of 2008, which is only about 1% of the market for cellphones. The company is booking the iPhone revenue as deferred revenue, and taking it as current revenue over a 24 month period (which is the contract period customers sign up for). This means the company will recognize about $75 per iPhone sale per quarter.
Upcoming products for Apple include a new Mac computer and a Windows version of the Safari browser These hardware and software developments are also excellent for investors, as they mean that Apple is continuing to grow in more than one area. How horrible it would be if the company relied solely on the iPhone to fuel new sales, and left development of other products go.
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