By Graham K. Rogers

Opening Gambit:

Ah, I got the dates the wrong way round (23/25): the correct version is Event 23rd and Q4 25th.

Predicting Apple

Now that Steve has gone, the new CEO has another cross to bear: Tim Cook is not Steve Jobs. And so the company is even more doomed; the end is even nearer; but the products keep going out of the doors, particularly in business areas where companies and organisations are switching their entire product needs towards Cupertino with the iPhone, iPad and latterly Macs too.

An example appeared over the weekend in an article on Next Gov which reports that US Immigration and Customs is going to end its eight-year relationship with the BlackBerry and is instead going for iPhones. There was a similar report last week about Woolworths (Australia) who were doing the same.

I had a look at this over the weekend with an item on Tim Cook, Criticism and the Legacy of Steve Jobs as the way that the critics of Apple keep on with these ideas -- but fail to grasp some of the basics of what Apple is -- demonstrates some astounding stupidity, yet people rely on these analysts and commentators for advice.

"What would Steve have done?" was the refrain from many, forgetting that Tim is not Steve and Apple had made mistakes before Tim Cook took the chair. The Cube (great idea, I loved it, others hated it) and Ping spring to mind. Note here that Steve pushed this and Cook killed it.

On Sunday while looking through online sources I checked The Macalope who commented on one consultant who had gone the route of cherry-picking Steve Wozniak quotes. The other founder of Apple has some good quotes, but some incredibly bad ones at time and the less than best had been sifted out for use.

The article warms up by savaging comments on the advance of the Blackberry (yeah, you have to read this) then looks at the comments of a hedge fund manager, which was enough to warn me off this article last week. One interesting comment by The Macalope was what I have mentioned before concerning the way commentators highlight market share as an indicator. Apple makes cash.

Those of us who have been watching Apple for a while know that this is nothing: no point having a 90% market share if you make no money. And that is what Apple does: it is a hardware company -- so many fail to grasp that basic point -- and makes money. If part of the process means making innovative, and quality products, and charging higher prices for them, that is the way it works.

A topical example may be found in the opening of a new Apple store in China this weekend which was just packed out, like other Apple store openings. A report by Philip Elmer-DeWitt on Fortune has some suitable comments (including on the chaotic iPhone 4S release) and a video. Being Asia, the crowds were not exactly ordered and in total control, which some commentators might want to think about the next time there are reports of riots at a Foxconn factory.

A crowd in Asia gathers a crowd. Everyone wants to be at the front. No one believes what they are told unless they want to; and they usually want to believe crazy rumours floating round. If the security guards whack someone across the head (how many have experience of an educated and properly trained security guard in this part of the world?), the scene is set for a potential riot: just light up blue-shirted security guard and stand well back.

Another report on the opening was on AppleInsider by Mikey Campbell.

The problem with analysts is that they have to make predictions (note: I make precious few here for the reasons that I hate being wrong) and sometimes they base them on incomplete data. Or guesswork. Or maybe some of them still sacrifice chickens and examine the entrails for omens.

About three years ago, Gartner made a prediction, we are reminded by Daniel Eran Dilger, that "Android would pass Apple's iOS by this point in 2012 to become the second largest mobile platform . . . after Nokia's Symbian, closely followed by RIM's Blackberry and Microsoft's Windows Mobile."

How many prediction errors can be seen in just that one sentence from Dilger's scathing comments.

It is of course in their interests for analysts to talk Apple down as then they can advise clients to buy. With the shares hovering just above $600 this weekend and at least two major announcements coming, there is a quick one hundred bucks a share to be made here: more if the critics cry, "Woe, alas, all is lost." Philip Elmer-DeWitt highlights two commentators on their different views of what is going to happen with Apple: you can probably guess which one I would go with.

On the figures, the previous quarter was reported to be disappointing by analysts who saw falling this and less of that everywhere, and put much of their disappointment down to customers waiting for the iPhone 5. The iPhone 4 and 4S were still going out of the door, and Apple was still making massive profits, but less than the figures the pundits had pulled out of the air.

In the last quarter report there was quarterly revenue of $35.0 billion and quarterly net profit of $8.8 billion, which was up from the year before. It is odd what disappoints some people, eh? Peter Oppenheimer (CFO) said then, "we expect revenue of about $34 billion" for the next quarter: the one reported on Tuesday (25 Oct) which will come down in the early morning here.

Note too that in the last week, a number of companies have reported their quarterly results and all have been disappointing. In a report carried on Huffington Post, Ben Berkowitz of Reuters examines some of the less than stellar figures released from corporate America and some of the key words they use as smokescreens.

As to the products, we now know (this appeared in a search on the Apple online store over the weekend [Rene Ritchie, iMore]) that the iPad mini is to be announced; but there are other rumours, including the Retina display MacBook Pro 13"; the Mac mini; the iMac; and iBooks (Daniel Eran Dilger). And iTunes. I mentioned last week that a new version was coming, as we were told last month, but pre-announcing this and then tying the update release with the arrival of new products and services, suggest there are to be a number of changes to the way Apple interlinks these parts of the picture. Daniel Eran Dilger on AppleInsider has some useful information on this expected release.

There are rumours too that the current iPad is to be "tweaked" with the addition of a Lightning port and that the iPad 2 will be dropped, so Electronista reports. While there may be some sense in changing the current iPad -- some users will be grumpy, they always are -- I do not see that the iPad 2 will go as there are still a fair number of sales, especially in non-US markets.

That point about markets outside the US is often overlooked by analysts; and this is a dereliction. With Apple selling over 50% of its products (63% in Q4 2011) in international markets, those analysts who only examine the US figures to make predictions are likely to be way off base.

Graham K. Rogers teaches at the Faculty of Engineering, Mahidol University in Thailand. He wrote in the Bangkok Post, Database supplement on IT subjects. For the last seven years of Database he wrote a column on Apple and Macs.