Here’s the logic for a cheaper iPhone and the possible end of the iPod Touch this Fall:

On Tuesday TUAW reported that iOS 5 firmware referenced 2 new iPad models (3,1, and 3,2), as well as 2 unreleased iPhone models (4,1, and 4,2) that were seen in January.¹ Also interesting is that no new iPod 5,1 references have been found.²This doesn’t necessarily mean anything, but it is out of the ordinary for no references to have been found for an Apple product this close to historical launch patterns. Generally next generation Apple products are seen referenced in firmware roughly 8-10 months prior to release.³ This would put the next iPhone launching sometime between August and October, which also coincides with most expectations. There is no way an iPod is being held back past next spring’s iPad launch based on this 8-10 month pattern.

Another interesting piece of information is that the next generation iPhone isexpected to be a GSM/CDMA world phone. If this is the case, there shouldn’t be a need for a GSM 4,1 and CDMA 4,2, so what is the iPhone 4,2? Though it is possible that there would be another variant to include China’s own TD-SCDMA and WAPI, or a US version including T-Mobile or LTE, but this could also be a cheaper iPhone to replace the iPod Touch. Tim Cook recently said that Apple would figure out the prepaid market and that it didn’t want its products to be just for the rich…

I have no insider information or sources and I’m just speculating based on information and rumors, but I think there is a good chance that we’ll finally see a significantly cheaper iPhone this fall, though it is possible it will come out next year instead. I think this will be the long rumored iPhone Nano (though it won’t likely be named that). I don’t necessarily think this means it will be smaller. It will have cheaper components such as perhaps not including a retina display, having a slower processor, and less storage. This will be necessary since a prepaid phone will not be subsidized. It may only need a prepaid data plan like the iPad and will use iMessage rather than SMS and maybe even FaceTime without the ‘face’ for calls. Recently there has been some potential evidence that FaceTime will work over cellular data in iOS 5. Apple said last year that FaceTime would be wifi-only in 2010.

^{1 There is also a never released iPhone 3,2 that was found last year that may have been a GSM/CDMA variant. It’s also possible that this was released as the China phone with WIFI and WAPI, though I haven’t seen any information backing that.
2 Next-gen iPhone is 4,1 while iPod would be 5,1 because iPhone 3G was referenced as iPhone 1,2.
3 New Apple products such as the iPad before it was released wasn’t called iPad 1,1 in firmware, but rather iProd 1,1, and these don’t necessarily show up in firmware on the same schedule.}

The Research In Motion earnings call was entertaining, awkward, and hyperbolic as usual! I’ll give some key takeaways from the call, and then follow up with a brief analysis of RIM’s outlook.

-Earnings and gross margin guidance was called “atrocious” by CNBC’s Guy Adami. Guidance includes management’s expectations on the Playbook launch, which it said would be a “big selling” product. VP Investor Relations Adele Ebbs said the Playbook would be lower margin than RIM’s corporate margins (41% in the quarter). Lower average selling prices on products and higher marketing expenses were given as other reasons for lower margins. Margin compression is expected despite increased product mix of the relatively high-margin Blackberry 8520, and other products that are late-stage (nearing end-of-life) and thus are typically higher margin as well.

-Japan supply-chain issues with smartphone components are said to potentially affect revenue. This was said to be a reason for the larger range for earnings and revenue guidance.

-Management confirmed QNX-based “superphones” are coming in calendar 2012, and this was seen as somewhat of a surprise by RBC analyst Mike Abramsky. This led some analysts to ask whether there would be risk of a lack of uptake of RIM smartphones until next year, but Co-CEO Jim Balsillie claimed there was tremendous interest in this summer’s new products based on OS 6.1 and they were claimed to be a major upgrade.

-Balsillie responded to a question about future entry level smartphones at lower price points positively, though these wouldn’t be coming out this calendar year.

-Ebbs and Balsillie said there will be no new products other than the Playbook until fiscal Q2 (June-Aug) and Q3.

-Management statements hint that RIM overstuffed the sales channel at the end of last quarter though they also claimed inventories are lower because of higher sell-through. This seems contradictory but it wasn’t explained further.

-On a positive note, RIM execs are forecasting much higher than expected earnings for fiscal year 2012 of $7.50, yet they didn’t seem very confident in that forecast.

The bottom line is that more than 4 years after the iPhone disrupted the industry, RIM’s Blackberry OS products are no longer competitive at any price-point without margin deterioration. There is a now a lot of uncertainty and skepticism in RIM’s product launch schedule, platform strategy, differentiation, and ability to execute and innovate at a level and pace competitive with Apple and Google.

Image from: http://www.cantechletter.com/2010/05/10-moments-in-canadian-tech-stock-history-that-changed-the-world/

iPhone 3.0 better have voice controls like these if Apple wants to reign unchallenged in consumer mindshare.

Amazing talk. Must watch if you’re interested in financial speculation, financial crises, want to better understand the current financial crisis, or just want to know how you can make billions for years and then lose it all in a few weeks.

“Eric Rosenfeld, the one-time Harvard professor who became a trader at Long-Term Capital Management in the 1990s, explains how a portfolio balanced in a way so that it appears “riskless” because it has so many diversified positions can be made very risky when too many people holding similar positions decide to exit at the same time. In short, trades that don’t seem to be correlated at a fundamental economic level or according to history can nonetheless become correlatedthrough trading activity.”

Watch the video at BusinessInsider

[photo from bull n bear]

“Don’t believe everything you learn in business school, cautions Harvard Business School professor Clayton Christensen. “It’s the principles of good management we teach that cause successful companies to fail.” In this meaty lecture, Christensen distills several books’ worth of research describing how business leaders sometimes metamorphose into losers when confronted with market-rocking innovations. He also reveals how we may harness his insights in such socially significant and complex industries as healthcare. “

“Christensen distinguishes between the kind of sustained and incremental technological improvements that help a market leader retain its edge, and “disruptive technology,” where a simple and affordable idea takes root in “an undemanding application at the bottom of the market, then improves from that foothold.” Christensen, looking at lots of industries “found almost invariably that an entrant company came in and killed the leaders” by way of a simplifying technology. He offers a case study of apparently marginal mini-steel mills that over a few decades toppled big U.S. steel mills. As the little guys pursued the lowest profit segment of the steel market with their more efficient, lower-cost methods, the big mills fled to where they imagined higher profits lay. Says Christensen, “You’re a little boy and want to win a fight against the giant. The best way to win is to pick a fight where the giant is motivated to flee rather than to fight.” 

“This has happened in the computer industry (mainframes to PCs), and with autos (Ford to Toyota). Department stores yielded to Walmarts, and JP Morgan to Fidelity, says Christensen. In each case, three enablers come into play: the transformation of a basic technology problem in the industry into “something that’s foolproof and idiot simple;” and the embedding of that solution into a cost-effective business model, which itself falls within a “complete vertical commercial system.” 

“Christensen spies symptoms of such disruptions bubbling up in the healthcare industry, such as molecular diagnostics, imaging technologies and high bandwidth telecom, and business model innovations. Integrated health systems like Kaiser Permanente have a leg up in deploying and optimizing these disruptive technologies. 

“The push for widespread healthcare reform must come from employers, who in spite of their declared intent to cut healthcare costs also know “they profit when their employees are healthy and productive.” Affordable healthcare, he concludes, “doesn’t come by expecting high end, expensive institutions or expensive caregivers to become cheap, but by bringing technology to lower cost providers and venues of care, so they can become more capable.

http://mitworld.mit.edu/video/594

Socialized risk, privatized profit?, exchange rates, etc.

http://fora.tv/2009/03/25/Treasury_Secretary_Geithner_on_Financial_System_Oversight