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CNN: Crouching Tiger, Hidden Profits?

by , 1:00 PM EST, March 30th, 2005

The next major upgrade to Mac OS X, Tiger, could be a big source of profits to Apple for the rest of fiscal 2005, according to a CNN editorial. Quoting several analysts, Paul R. La Monica wrote that the profits from Apple's software sales could receive a big boost from Tiger, and that this was in addition to the company's ability to innovate, growing Mac sales, and its huge cash horde, all of which are also reasons to invest.

With Apple being one of only three tech stocks showing double digit stock growth in 2005, it's also one of the only games in town, according o Mr. La Monica.

For the past six months, the driving vehicle for growth has been the iPod, but Mr. La Monica said that Tiger could be the surprise area of growth in the near future.

Mr. La Monica cited one analyst who talked up Apple's software side as a major source of gross margins and profits, and another who said he thinks that Tiger will not only sell well itself, but that it will also drive a round of hardware upgrades of Macintosh computers.

He also quoted a third analyst who was bullish on Apple because even a small increase in market share for the company would translate into a big boost to its bottom line.

The full article goes into much more depth on these issues, as well as Apple's commitment to innovation and other factors that he said make the company's stock attractive.

Apple stock is trading higher today in moderate volume.

*In the interest of full disclosure, the author holds a small share in APPL stock that was not an influence in the creation of this article.  


If you are interested in Apple's stock, join our forum members in the Apple Finance Boards, a moderated forum for Apple Investors and people who are interested in Apple's financial dealings. For other stories regarding Apple's stock activity, visit our updated Apple Stock Watch Special Report.

Observer Comments

Show: Subjects Only | Full Comments
View Name:Guest
Subject:
Close Name:Tiger Posts: 940 Joined: 17 Jun 2003
Subject: how many

How many MacMini owners are going to moan and whine on this site when Apple doesn't include a free upgrade to 10.4 with their newly purchased machines? If past history is any indicator, a LOT.

Should they? Not my call.

We all have to buy it sometime.

View Name:Guest
Subject: people will always whine
View Name:RealityCheck -   Troll Posts: 392 Joined: 06 May 2004
Subject: Mac Mini Owners Will Need Memory Upgrade
Close Name:Small White Car Posts: 1950 Joined: 02 Jul 2004
Subject:

Quote
RealityCheck wrote:
Wait till unsuspecting newbies to the Mac platform try to cram Tiger into their shinny new Mac mini. With the standard 256MB memory, Tiger will bring their shinny new toy to a standstill. Check the facts:
http://www.appleinsider.com/article.php?id=945


Hmm, I can't seem to find that "fact" anywhere in that link. I see the part where future machines will have better hardware and that future software will work better with better hardware.

As SHOCKING as those facts are, I didn't see anything about Tiger not being able to work with a Mac mini.

Close Name:iBill Posts: 545 Joined: 23 Feb 2005
Subject: Mini Memory

Quote
RealityCheck wrote:
Wait till unsuspecting newbies to the Mac platform try to cram Tiger into their shinny new Mac mini. With the standard 256MB memory, Tiger will bring their shinny new toy to a standstill. Check the facts:
http://www.appleinsider.com/article.php?id=945


Must be a slow day in "RealityCheck" land.

View Name:RealityCheck -   Troll Posts: 392 Joined: 06 May 2004
Subject: Small White Car - Please Read More Carefully
Close Name:Small White Car Posts: 1950 Joined: 02 Jul 2004
Subject: Re: Small White Car - Please Read More Carefully

Quote
RealityCheck wrote:
According to the article, Apple insiders said for Tiger and iLife a memory upgrade is "much needed." This is corporate speak for your machine will be total dog unless you upgrade.


I kind of figured they're trying to sell their product and make more money. But if you trust what corporate executives say 100% (even those at Apple!) well, more power to you.

That aside, the consumer has SOME responsibility to know what they're buying, you know. If someone went out and bought a Dell with 256 MB of memory I'd bet they wouldn't be thrilled with that performance either. At some point you have to blame the comsumer for looking at the fact that they can double their RAM for $75 and saying "Nah...I'm not gonna be doing that."

View Name:Guest
Subject: RC - Please Use Real News Sources and a Spell Checker
View Name:Guest
Subject:
Close Name:MonkeyT Posts: 77 Joined: 29 Nov 2001
Subject: biding time

There's an awful lot of folks running older hardware who are waiting to upgrade because they see no need to spend money on hardware now and money on the OS later (yeah, Apple's history is flakey on upgrade pricing). When Tiger's release date is announced and the upgrade policy is established, the mini sales will skyrocket.

View Name:Guest
Subject:
View Name:Guest
Subject: Please....
View Name:Guest
Subject: Here's a fact
Close Name:dux5 Posts: 106 Joined: 02 Jul 2002
Subject:

Quote
MonkeyT wrote:
There's an awful lot of folks running older hardware who are waiting to upgrade because they see no need to spend money on hardware now and money on the OS later ... When Tiger's release date is announced and the upgrade policy is established, the mini sales will skyrocket.


True. But, I think the opposite is also true.

I saw some stats a while back that were absolutely staggering. I forget the exact percentage now, but IIRC, a significant majority of computer purchasers never "upgrade" their OS.

In other words, if those stats are correct, those who are buying a Mini and are in the target market for the product (ie: new Mac user and a low-end user) than half to 3/4s won't have an interest in upgrading to Tiger. Obviously, that still leaves a large number of people who are going to be upset that they bought the computer only to have the OS outdated rapidly.

That said, I'll bet a lot of them know that Tiger is coming becuase the Mini isn't the first thing that's gotten them interested in Apple ... it's just what finally pushed the purchase. Of course, they're Windows users, so none of them will actually believe that Tiger will ship as promised since they've been "expecting" Longhorn for half a decade now.

The people, IMO, who will be upset are current Mac users (or returning Mac users) who have replaced an older machine. Probably half of them know that Tiger is coming and figure they'll have to pay for it ... but they'll whine anyway just cuz they like to complain.

Close Name:Small White Car Posts: 1950 Joined: 02 Jul 2004
Subject:

Quote
dux5 wrote:

I saw some stats a while back that were absolutely staggering. I forget the exact percentage now, but IIRC, a significant majority of computer purchasers never "upgrade" their OS.


I believe that. I think that for many people, this habit can be traced back to early versions of windows.

My mother is fearful of every upgrading anything on her computer because during that time period, an upgrade often meant that a printer or a scanner would no longer work with a newer OS. This was usually the fault of the device makers not updating drivers, but the result was that an OS upgrade meant weeks of trying to get everything to work right again.

That doesn't happen too much anymore (with Macs OR with Windows) but that was a hard learned lesson that's hard to un-learn.

Not wanting to pay the price to upgrade is one reason, but I think "fear of changing anything" on a computer is still a big reason, even if it's not a problem any more.

Close Name:Intruder -   TMO Mac Specialist Posts: 2928 Joined: 07 Jul 2004
Subject:

Quote
RealityCheck wrote:
Wait till unsuspecting newbies to the Mac platform try to cram Tiger into their shinny new Mac mini. With the standard 256MB memory, Tiger will bring their shinny new toy to a standstill. Check the facts:
http://www.appleinsider.com/article.php?id=945


Hmmm...

Here are Microsoft's Longhorn hardware recommendations:

Desktop CPU: 3 GHz Intel Pentium 4 processor with HyperThreading Technology 530 (or higher) or 3 GHz Intel Xeon processor with 2 MB L2 cache, or AMD Athlon 64, Sempron, or Opteron 100, 200, or 800 processor, single or dual-core versions.

Mobile CPU: 1.86 GHz Intel Pentium M processor 750 (or higher), or AMD Turion 64 Mobile Technology, Mobile Sempron, or Mobile Athlon 64 processor.

RAM: 512 MB of RAM or more, all platforms.

Source: http://winsupersite.com/showcase/longhorn_preview_2005.asp (ummmm... Paul Thurrott's site!)

Wow. I don't see Dell's $399 desktop machine having a prayer at running the next generation of Microsoft's OS.

Close Name:jimothy Posts: 581 Joined: 04 Jun 2004
Subject:

Quote
Intruder wrote:
Wow. I don't see Dell's $399 desktop machine having a prayer at running the next generation of Microsoft's OS.

Yeah, but by the time Longhorn actually ships, a computer with those specs will be dirt cheap. Of course, we'll also all be Longdead!

Close Name:kenaustus Posts: 601 Joined: 27 Jun 2003
Subject: I think RC knows the truth

Retailers love computers with 256 memory as they can sell upgrades. Dell, not being sold in stores, uses their 256 as SHARED memory - don't they RC? By now even RC knows that he can buy a Mac with 256 and then get a gig stick from a 3rd party supplier - and a putty knife if he gets a Mac mini.

Tiger will also work on a lot of older Macs where Longhorn will need some hefty investments in hardware for many. The mass of code in Longhorn will probably result in two versions - pro and home - just so it can run on the lower priced computers. Because Tiger doesn't have all the slop Longhorn will have Mac users can use the full version.

When you buy Tiger you will get the full OS - not an upgrade. How will MS handle that? Probably with an upgrade that costs more than Tigers probable $129 price for the full version.

Personally I have to buy the Family Pack when tiger comes out as I now have 5 Macs that will get moved up - the oldest ones being a 667 PB and a 500 iBook. That's about $50 per computer (less educational discount). Is MS going to do anything like that, or are they still back in the 3.1 days?

Close Name:kenaustus Posts: 601 Joined: 27 Jun 2003
Subject: I think RC knows the truth

Retailers love computers with 256 memory as they can sell upgrades. Dell, not being sold in stores, uses their 256 as SHARED memory - don't they RC? By now even RC knows that he can buy a Mac with 256 and then get a gig stick from a 3rd party supplier - and a putty knife if he gets a Mac mini.

Tiger will also work on a lot of older Macs where Longhorn will need some hefty investments in hardware for many. The mass of code in Longhorn will probably result in two versions - pro and home - just so it can run on the lower priced computers. Because Tiger doesn't have all the slop Longhorn will have Mac users can use the full version.

When you buy Tiger you will get the full OS - not an upgrade. How will MS handle that? Probably with an upgrade that costs more than Tigers probable $129 price for the full version.

Personally I have to buy the Family Pack when tiger comes out as I now have 5 Macs that will get moved up - the oldest ones being a 667 PB and a 500 iBook. That's about $50 per computer (less educational discount). Is MS going to do anything like that, or are they still back in the 3.1 days?

View Name:Guest
Subject: Count me as one of the wait-ers...
Close Name:aaronsullivan Posts: 87 Joined: 22 Oct 2001
Subject: guide to upgrading

For the Guest waiting to switch. MacRumors has a nice buyers guide that gives a rough estimate of when new macs may come out. Very handy:
http://buyersguide.macrumors.com/

View Name:Guest
Subject: My God, another Apple score
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