Keeping you in the loop on some of the things that happened around Apple this week.
The iPhone 5s still might be rare, judging by the reaction whenever I pull out my new phone. But the supply situation for Apple’s new high-end smartphone seems to be improving. “Last year, we noted essentially zero iPhone 5 availability at Apple Stores in the second week after the launch. For the 5S, we are currently seeing availability for at least one model on AT&T, Verizon, or Sprint at nearly every Apple Store we checked,” Piper Jaffray’s Gene Munster said in an Oct. 4 note. We believe that last year, the new casing/larger screen size were causing yield issues with Apple’s suppliers, which cause a supply issue. Since the casing/screen are the same in the 5S, we believe only the fingerprint sensor could be the bottleneck this year and, based on our store checks, it appears Apple has done a good job of addressing any issues it may have been having early on with the production of the sensors.” By the way, if you’re in the market for an iPhone 5c, which starts at $99, Wal-Mart, RadioShack and Best Buy are offering deals in coming weeks that reduce the price by offering buyers a gift card — ranging from $20 to $50 — with purchase of the phone and a two-year wireless contract. Wal-Mart seems to be the low-priced leader, offering the 5c for basically $45 through the holiday season.
Billionaire investor Carl Icahn met with Apple CEO Tim Cook to talk about using more of the company’s nearly $147 billion in cash to expanding the current $60 billion share buyback program and he was keen to share the details. He first tweeted about the “cordial dinner” between the two last week, and then went on to the media circuit to talk up his plan for Apple to do a $150 billion buyback program. “I’m not threatening anything and I’m not talking about any proxy fight,” Icahn, who recently lost a battle with Dell over taking the PC maker private, told CNBC. But the buyback is a “no-brainer and it makes no sense for this company with their multiple being so low not to do a major, major buyback. I feel very strongly about this. I can’t promise you the stock will go up and I can’t promise you they will do the buyback. But I can promise you that I’m not going away until they hear a lot more from me concerning this.” Icahn says he plans to meet with Cook again later this month.
Apple ranks among the top five cash kings among non-financial companies in the U.S., according to Moody’s, which said last week that Apple, Microsoft, Google, Cisco and Pfizer together hold $379 billion, or 26%, of the total non-financial corporate cash balance. This compares with $347 billion, or 24%, in 2012 and $278 billion, or 21%, in 2011. “Apple continues to lead by a wide margin, with $147 billion, or 9.9% of total cash at mid-2013, compared with $137 billion, or 9.5%, at the end of 2012. Microsoft is second, with $77 billion, while Google has $54 billion and Cisco, $50 billion. Here’s Moody’s takeaway: It’s Apple’s that accounts for the growing concentration of cash among the top 50 companies, even after taking into consideration its “more aggressive capital allocation plan,” said Moody’s Richard Lane. “Apple’s surging cash balance has brought the concentration of cash among the top 50 US companies to 64% of total corporate cash, while it held steady at just above 50% through 2009.”
Apple just isn’t top in terms of cash. Interbrand, which has been putting together a Best Global Brands report since 2000, said Apple is now the most valuable brand in the world, surpassing Coca-Cola, which fell to No. 3 (afer Google) after having top honors for the past 13 years. Apple was No. 2 last year among the world’s 100 most valuable brands and in 2000, it was ranked No. 36 with a brand value of $6.6 billion. Today, Apple’s brand is valued at $98.3 billion. Says Interbrand: “Apple’s meteoric rise in brand value can be attributed to the way it has created a seamless omnichannel experience for customers. By keeping consumers at the center of everything it does, Apple is able to anticipate what they want next and break new ground in terms of both design and performance…Tim Cook has assembled a solid leadership team and has kept Steve Jobs’ vision intact – a vision that has allowed Apple to deliver on its promise of innovation time and time again.”
Apple reportedly bought venture backed startup Cue, a personal assistant app for the iPhone that uses contacts, e-mail and files to create a daily agenda, for somewhere between $40 and $60 million, according to AppleInsider and TechCrunch. Apple, as always, says it periodically buys small companies from time to time but doesn’t comment on its acquisitions. Cue’s technology would help enhance Apple’s Siri voice assistant. Cue’s co-founder and CEO Daniel Gross told Forbes in August that while Cue (formerly called Greplin) had worked for the last three years creating its data-organizing software, it was “hard” to design an interface that consumers could understand and use easily. And while Gross said he wasn’t interested in selling out his company earlier this year, that obviously changed when Apple called. “People ask why don’t we white label what we do and let someone solve the interface problem. My opinion is the goal and mission of company is to be a brand people live and breath every day and hopefully love and appreciate and find useful.” In any case, the Cue website says the service is shut down and thanks users for their loyal support.
Speaking of Siri, voice-over actress Susan Bennett says she is the voice of Siri (or the original voice of the U.S. Siri introduced in the iPhone 4s in October 2011, that is. I just switched over my Siri voice to the male option now available in iOS 7). Anyway, Bennett, who lives in Atlanta, decided to out herself after stories appeared last month identifying another actress as the voice of Siri. Apple hasn’t ever said who the voice belongs to. Bennett said she had no idea when she spent four hours a day for a month in July 2005 recording nonsensical phrases and sentences that they would end up in Siri. “”There are some people that just can read hour upon hour upon hour, and it’s not a problem. For me, I get extremely bored … So I just take breaks. That’s one of the reasons why Siri might sometimes sound like she has a bit of an attitude,” Bennett told CNN. “Those sounds might have been recorded the last 15 minutes of those four hours.” Believe it or not, Siri was her first voice outing as a digital assistant. Bennett says the voice of Tillie the all-time teller, the first ATM assistant.
iTunes chief Eddie Cue said he hopes Apple’s new Internet Radio service, iTunes Radio, will be up and running outside the U.S. soon. “One of our top priorities is to bring iTunes Radio obviously here in the U.K. but everywhere in the world,” Cue said in an interview from London with The Financial Express. “We certainly want to be in more than 100 countries.” Apple launched its service last month and announced that it had 11 million users in the first five days. And while that’s still paltry compared to market leader Pandora, with its more than 72 million monthly active listeners, Apple, said Cue, is “very pleased” with the initial reception to its service.
President Obama, addressing the nation earlier this week about the rollout of his Obamacare system, said that users checking out details of the program on the government and state’s websites would likely run into glitches (like outages and slow response times). And he compared the rollout to Apple’s launch of iOS 7, which was updated after privacy glitches with the new mobile software were revealed. “Like every new law, every new product rollout, there are going to be some glitches in the sign-up process along the way that we will fix,” the president said during his Oct. 1 press conference. “Consider that just a couple of weeks ago, Apple rolled out a new mobile operating system, and within days, they found a glitch, so they fixed it. I don’t remember anybody suggesting Apple should stop selling iPhones or iPads — or threatening to shut down the company if they didn’t. That’s not how we do things in America. We don’t actively root for failure. We get to work, we make things happen, we make them better, we keep going.” The good news is that demand for the Affordable Care Act’s healthcare options is better than even the president’s administration expected, judging by traffic to the site. Now they just have to make sure you can actually sign up online. Siri, any suggestions?
It’s not surprising that Apple’s marketing chief Phil Schiller would be gleeful over an Ars Technica report that found that Samsung had been manipulating the processors in its Galaxy Note 3 to help increase its benchmarking test scores for speed and processing power. Schiller sent out a one word tweet —“Shenanigans” — with a link to the story describing how Samsung is artificially boosting its benchmark scores. Why do I say that it’s not surprising? Schiller’s job is to be Apple’s marketing cheerleader and though he’s been relatively quiet outside of Apple events over the years, he’s become a bit more vocal in the past year or so — including trash talking the Galaxy S4 to a few reporters the day before Samsung introduced the smartphone in March.
Schiller may get yet another chance to deride Samsung next month — he may testify in a retrial over damages in the Apple-Samsung patent trial that Apple won last year. The $1.05 billion Apple was awarded in damages was reduced to about $580 million, and the two parties will go back before Judge Lucy Koh in federal court in San Jose, California, on Nov. 12 to re-argue damages. Apple’s witness list includes Schiller, Scott Forstall, iOS software chief who was fired last year, and Susan Kare, who designed some of the icons for the Mac back in the 1980s.
The Los Altos Historical Commission has proposed making Steve Jobs’ home, and the garage where he first set up Apple, a home of “historical significance.” The California ranch-style home, which Ashton Kutcher used to film his recent Steve Jobs biopic, is at 2066 Crist Drive and owned by Jobs’ sister, Patty Jobs. Marilyn Jobs, Patty and Steve’s stepmother, lives in the house and has put up a sign asking Apple fans to shoot their photographs from the street. If the house is granted historical value, future renovation would need to be approved by the city, notes. The San Jose Mercury News, which spoke with Patty Jobs, notes that she was one of Apple’s many early helpers, building circuit boards for her brother in their living room as early as 1975. “I’d get yelled at if I bent a prong,” she said.
The Apple Garage, in Los Altos, CA. Steve Jobs’ family home and the birthplace of Apple Computer.
Remembering Steve. Yesterday was the two-year anniversary of the death of Steve Jobs, and Tim Cook decided to remember the day by sending an email to employees paying tribute to Apple’s co-founder. “I hope everyone will reflect on what he meant to all of us and to the world. Steve was an amazing human being and left the world a better place,” Cook wrote. You can read his email here. As for me, I like the stories that Jobs’ friends told me last year to honor their friend and colleague, including the one where he left Bill Gates waiting in the lobby for an hour. You can read those stories here.
That’s it. Have a good week.