Week 26: F.U.D. of the Week

  • Posted: 28 June 2011 02:21 PM #16

    Apple offers refunds for Final Cut Pro X

    Good for Apple! Now anyone who doesn’t like Final Cut Pro X can get their money back and shut the FUD up.

    The only remaining argument is that Apple “should” continue to support the previous version of Final Cut. Good luck with that.

         
  • Posted: 28 June 2011 08:24 PM #17

    This article from Forbes “Intelligent Investing” section caused me some serious acid reflux.

    Why Apple, Google And EBay Will Slash And Burn Investors

    [ Edited: 28 June 2011 09:21 PM by cranium ]      
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    Posted: 28 June 2011 09:33 PM #18

    cranium - 28 June 2011 11:24 PM

    This article from Forbes “Intelligent Investing” section caused me some serious acid reflux.

    Why Apple, Google And EBay Will Slash And Burn Investors

    This was a comment to the article:

    As a serioius investor I find your article on AAPL one of the weakest I?ve ever read on Forbes. You make no point other than ?what?s hot must get cold?. I may even agree with you on that, but the key point is to determine WHEN it will get cold. I?m not an Apple or Steve Jobs fan as I?ve always been a PC and Blackberry user and don?t see my usage habits changing no matter what trends are occurring with the masses.

    However, as an investor, I follow numbers, trends, and sentiment. I?ve been watching Apple for almost two years now and have finally invested heavily in it. I like ideas that challenge the thoughts I?ve been developing, but your vacuous ?it will simply go cold? argument gives me nothing to break down my current thesis. In fact, it probably strengthens my resolve because like you and with my former thinking, there are still many buyers to convert to AAPL investors.

    You state ?There will come a point in AAPL?s existence where the premium paid will not justify the potential for return on capital down the road?. You will one day be correct, but analysis shows this day to be far down the road and there is money to be made today. In fact, there is no premium on AAPL right now, there is a huge discount being offered that I can no longer ignore.

    Some talk of the ?Steve Jobs premium?. I?d argue that the uncertainty of his pending demise is hurting the stock and that following a period of volatility, the loss of this uncertainty will eventually be a benefit to the stock. This is the kind of discount I will take advantage of because it will be of limited duration,

    IF Apple was trading at 40 times earnings, I?d probably agree with you that it?s time to run, but while there certainly isn?t space for the numbers here, there is a great discount available. With a cash discounted PE of 12, and earnings growth last quarter at 95%, and settling in the 40-50% range even 24 months out, this is an opportunity, not a liability in any portfolio.

    Quick overview of product landscape

    iPhone

    - secular industry trends towards smartphones
    - my trusty Blackberry losing share rapidly, Nokia losing share rapidly
    - Apple still not with the number of carriers that it should be. It bootstrapped adoption with only some carriers and until recently didn?t even have the CDMA technology required for others. It gets ?free? growth still by expanding carrier rollout (there are two to go here)
    - leading name with ?everyday? buyers that are only now moving en masse to smartphones. Android is the best name for the early adopters, but smartphones are now moving mainstream and Apple will do much better than Android with non-technical users
    - BRIC, and Apple has stated they are specifically targeting China. This means China Mobile at its 611 million subscribers are in Tim Cook?s crosshairs. This is not far out and will be a huge driver to the stock when announced. A cheaper iPhone targeted to pre-paid users is also not far away to help adoption across all these demographies
    - enterprise adoption ? this is another critical factor. The move from Blackberry has unfortunately begun and Apple is the prime benefactor here

    iPad ? another secular growth trend. Use it to short traditional technology companies against your Apple holding. This will drive tremendous growth for Apple. When you are the entire market, don?t focus on market share drops as they are a mathematical certainty, simply look and unit and revenue growth throughout. Currently, the pace of this growth only is dependent on Apple ability to manufacture these devices. This is the one Apple device that even I am considering purchasing.

    Mac ? Often ignored but still outgrowing the rest of the PC industry for the past 20 quarters in a row. Reaping the benefits of the ?halo effect? from the gadget buyers.

    iTunes, AppStore, iBookstore, iCloud ? Taking in billions and still proving glue to the entire ecosystem.

    Future Products ? is there really a true Apple television coming? Even while the key products are still in there early growth stages, there is talk of more products around the corner. This doesn?t appear to be a company that is sitting there milking the profits off a key product.

    Overall, I will agree with you that one day Apple will fall, but the key is knowing when this will happen, and there is nothing that shows this will happen anytime soon. I?ve switched my investment philosophy regarding AAPL, and am disappointed you didn?t give me anything at all to refute, or even to improve my thesis by allowing me to ruminate over a salient point to consider. I actually feel you have tarnished the Forbes name with this drivel and am shocked to see this under the ?Intelligent Investing? moniker. Help me think about my thesis, and you?ve provided a worthwhile read, toss off a general statement like this and you?ve only wasted my time.

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  • Posted: 29 June 2011 05:21 AM #19

    I am getting sick and tired of lazy journalists printing Fuddy press releases from security research firms. Man, with Windows upping it’s security a little, they are getting desperate for other streams of recurring revenue”

    Apple iOS has 10 times more vulnerabilities than Android
    by Khidr Suleman

    Apple’s iOS platform has 182 more known vulnerabilities at present than Google’s Android OS, according to security firm Symantec.

    The Window Into Mobile Device Security white paper analysed the Apple and Android platforms to determine their resistance to threats from malware, phishing, spam and data loss.

    “Security researchers discovered roughly 200 different vulnerabilities in various versions of the iOS operating system since its initial release. Of these, the vast majority were of lower severity,” said Carey Nachenberg, vice president and fellow at Symantec.

    “The remaining handful of vulnerabilities were of the highest severity and, when exploited, enabled an attacker to take administrator-level control of the device, granting them access to virtually all data and services.”

    However, Apple’s overall security is still considered to be very high, largely due to the built-in encryption and the firm’s stringent application vetting process.

    “IOS’ encryption system provides strong protection of emails and email attachments, and enables device wipe, but thus far has provided less protection against a physical device compromise by a determined attacker,” Nachenberg said.

    “Apple vets every single publicly available app. While this approach can almost certainly can be circumvented by a determined attacker, it has thus far proved a deterrent against malware attacks, data loss attacks, data integrity attacks and denial-of-service attacks.”

    It was also found that Apple’s mobile operating system is immune to traditional types of computer viruses and worms, but there is currently no protection to combat social engineering attacks in the form of phishing or spam, Nachenberg warned.

    Despite only 18 known vulnerabilities existing in the Android platform, it still has some major drawbacks, according to Symantec.

    The open nature of the ecosystem and the lack of vetting by Google allows cyber criminals to anonymously create and distribute apps containing malware via the Android Market and third-party web sites, Nachenberg explained.

    “Android’s permission system, while extremely powerful, ultimately relies upon the user to make important security decisions. Unfortunately, most users are not technically capable of making such decisions and this has already led to social engineering attacks,” he said.

    “Attackers can also easily ‘trojanise’ or inject malicious code into legitimate applications and then easily redistribute them across the internet, signing them with a new, anonymous certificate.”

    The lack of encryption has generally been an issue for Android. This has only recently been addressed with the incorporation of AES-256 encryption in the Honeycomb 3.0 release.

    Data stored on removable SD cards is vulnerable as it is unencrypted and can simply be removed if the device is lost or stolen.

    At this time, it appears that the iOS platform has the advantage in terms of enterprise deployment as it has been out longer and Apple is targeting businesses, explained Thomas Parsons, senior manager of quality assurance engineering at Symantec.

    “Both mobile operating systems have had security built in from the get-go, but design and implementation hasn’t been perfect,” he told V3.co.uk.

    “Apple takes a preventative approach towards security, while Google relies on a fast-response model. Both have their advantages and disadvantages, but Apple seems to be more secure as there are a reduced number of security gaps.”

    Parsons noted that Google is unlikely to start vetting applications in the way Apple does because there are “approximately 2,500 Android applications being loaded per day and it is simply not feasible at the moment”.

    Hmm where to begin? Pretty certain that there have been far more than 18 vulnerabilities found in Android - I am pretty sure that the last purge of the app store got rid of 25 or so and that just took them from the app store they can probably got from other, unsafer, sources.

    “The lack of encryption has generally been an issue for Android. This has only recently been addressed with the incorporation of AES-256 encryption in the Honeycomb 3.0 release.”

    Save that only very few devices run Honeycomb of course, don’t see having one build making anything safer for the vast majority…

    Notice with regard to iOS security they seem to imply lots of high threat stuff, but I am pretty certain that this is the consequences of jailbraking the phone and they don’t bother to mention that…

    grrrrrrrr.

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  • Posted: 29 June 2011 05:51 AM #20

    Actually BGR have similar coverage and the original Symantec press release:

    http://www.bgr.com/2011/06/28/ios-vs-android-which-mobile-os-is-more-secure/

    Symantec Analysis of Apple?s iOS and Google?s Android Platform Cites Improved Security over PCs, but Major Gaps Remain

    The mass adoption of both consumer and managed mobile devices exposes enterprises to new security risks

    MOUNTAIN VIEW, Calif. ? June 28, 2011 ? Symantec Corp. (Nasdaq: SYMC) today announced the publication of ?A Window into Mobile Device Security: Examining the security approaches employed in Apple?s iOS and Google?s Android? (PDF). This whitepaper conducts an in-depth, technical evaluation of the two predominant mobile platforms, Apple?s iOS and Google?s Android, in an effort to help corporations understand the security risks of deploying these devices in the enterprise.

    Chief among the findings is that while the most popular mobile platforms in use today were designed with security in mind, these provisions are not always sufficient to protect sensitive enterprise assets that regularly find their way onto devices. Complicating matters, today?s mobile devices are increasingly being connected to and synchronized with an entire ecosystem of 3rd-party cloud and desktop-based services outside the enterprise?s control, potentially exposing key enterprise assets to increased risk.

    The paper offers a detailed analysis of the security models employed by Apple?s iOS and Google?s Android platforms, evaluating each platform?s effectiveness against today?s major threats, including:

    ? Web-based and network-based attacks
    ? Malware
    ? Social engineering attacks
    ? Resource and service availability abuse
    ? Malicious and unintentional data loss
    ? Attacks on the integrity of the device?s data

    This analysis has led to some important conclusions:

    ? While offering improved security over traditional desktop-based operating systems, both iOS and Android are still vulnerable to many existing categories of attacks.
    ? iOS?s security model offers strong protection against traditional malware, primarily due to Apple?s rigorous app certification process and their developer certification process, which vets the identity of each software author and weeds out attackers.
    ??Google has opted for a less rigorous certification model, permitting any software developer to create and release apps anonymously, without inspection. This lack of certification has arguably led to today?s increasing volume of Android-specific malware.
    ? Users of both Android and iOS devices regularly synchronize their devices with 3rd-party cloud services (e.g., web-based calendars) and with their home desktop computers. This can potentially expose sensitive enterprise data stored on these devices to systems outside the governance of the enterprise..
    ? So-called ?jailbroken? devices, or devices whose security has been disabled, offer attractive targets for attackers since these devices are every bit as vulnerable as traditional PCs.

    Quotes:

    ?Today?s mobile devices are a mixed bag when it comes to security,? said Carey Nachenberg, Symantec Fellow and Chief Architect, Symantec Security Technology and Response. ?While more secure than traditional PCs, these platforms are still vulnerable to many traditional attacks. Moreover, enterprise employees are increasingly using unmanaged, personal devices to access sensitive enterprise resources, and then connecting these devices to 3rd-party services outside of the governance of the enterprise, potentially exposing key assets to attackers.?

    About Security Technology and Response

    The Security Technology and Response (STAR) organization, which includes Security Response, is a worldwide team of security engineers, threat analysts and researchers that provides the underlying functionality, content and support for all Symantec corporate and consumer security products. With Response centers located throughout the world, STAR monitors malicious code reports from more than 130 million systems across the Internet, receives data from 240,000 network sensors in more than 200 countries and tracks more than 25,000 vulnerabilities affecting more than 55,000 technologies from more than 8,000 vendors. The team uses this vast intelligence to develop and deliver the world?s most comprehensive security protection.

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    Posted: 29 June 2011 08:06 AM #21

    The FUD is

    1. Actual current numbers of compromised devices.
    2. Actual current numbers of how the device came to be that way.
    3. The difference between a weakness and a hole.

    The good news is that the topic of security returns.  Maybe something worthwhile will come of it.  I foresee an entirely new Unix core in the coming years.

         
  • Posted: 29 June 2011 10:45 AM #22

    For those of you who are worried about the new Final Cut Pro, I suggest you listen to Andy Ihnatko’s take on this week’s MacBreak Weekly.

    Andy is a big fan of Apple, but he’s not at all afraid to criticize them. I was cringing when he started to talk about the product. Instead of bashing Apple for the mis-handling of the roll-out (as I have) he talked about how he learned more in his first session with the new product than he ever had in the entire time he used the old product. Wow. Clearly, Apple has done something right. Again.

    This is so typical Apple. They re-think and re-invent. They start from the ground up and redo everything with the user experience in mind. What’s weird about Apple is that they don’t listen to their customers at all - normally considered the sine qua non of customer service. And yet Apple is loved like no other company I can think of. (Except, perhaps Harley Davidson. Their customers tattoo “Harley Davidson” on their tushes. Can any other company make such a claim?)

    Apple’s target is not the customer, it is the overall user experience. That’s a subtle and seemingly paradoxical distinction. Apple will tick off any number of their current customers in order to improve the overall user experience of all of their customers. Another way of saying that is that Apple will tick off any number of their current customers so that they can make things better for their future customers.

    It’s a bizarre philosophy, but it clearly works. People adore Apple because Apple keeps making their lives better. And they do this despite our earnest pleas that they please, please stop!

    I love watching this company. I learn something new about Apple every day and - when I’m paying close attention - Apple occasionally provides with with a new insight into the way people think and how companies should think too.

         
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    Posted: 29 June 2011 12:07 PM #23

    FalKirk - 29 June 2011 01:45 PM

    Except, perhaps Harley Davidson. Their customers tattoo “Harley Davidson” on their tushes. Can any other company make such a claim?.

    Well yes, Apple can
    http://tatuagemtattoo.com/tatuagem-apple-tattoo-tatuagens-apple-tattoos.html

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    Posted: 29 June 2011 12:16 PM #24

    TanToday - 27 June 2011 10:57 PM

    Comment on analysts from another site, though you all might enjoy it.


    A friend of mine wants to get a job as an ‘analyst’ here’s his resume:

    I’m breathing and can walk.

    smile

    If you have trouble doing them at the same time, Mr. Fischbaum, the job is yours!

         
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    Posted: 29 June 2011 12:24 PM #25

    rattyuk - 28 June 2011 01:46 PM

    Think Mr H Blodget hit a home run here…

    Google Android Activations Hit Spectacular 500,000 A Day, Leaving Apple In Dust

    Doesn’t provide a shred of evidence, save Android activation figures to support his argument.

    Actually, that was a pretty balanced assessment from Blodget. His two main contentions are that Android kicked Apple’s butt in phones (true by numbers) and that mobile is becoming a platform game. The latter is also fairly true, and while the Android platform is quite heterogenous, developers who see it as “fragmentation” on the API side will also see it as competitive opportunity on the sales side.

    I’ll admit, Apple makes excellent hardware. And its software is very good too. The problem for Apple is that Android hardware and software is more than good enough, even for normal people. Apple’s appeal is to aesthetes, not idiots.

    Back on platforms… Apple’s main platform fight so far has been against Flash, not Android. And that probably resulted in the industry coalescing around Android. What Apple will have to do to take on Android is embrace Flash and allow software from sources other than the App Store. Because lack of Flash and side-loading is now an additional “cost” of buying into Apple’s aesthetic. Anyone with half a brain realizes this now, even if they still have to front for Apple to be in good fanboy standing.

    And this leads to the FCPX reaction. Pros are telling Apple that they’re fine with Apple being all Apple with the iOS toys, but are not going to tolerate this “futuristic vision” crap on Macintosh or the pro tools they depend on. Vision does not pay the bills. The Mac video stack used to, handsomely. It’s not clear whether it will continue to do so. See also: Xserve.

         
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    Posted: 29 June 2011 12:26 PM #26

    Zeke - 27 June 2011 07:07 PM

    Adam Fischbaum at Street Authority in his article entitled “Forget Apple, Buy This Stock Instead” tries to sell us Nokia using the same kind of reasoning he might use to try to sell you a used car.  His conclusions are so far out in left field that I don’t even know where to begin.

    I can’t supply a link because AFB has this site blacklisted.

    See if this works if you copy and paste http://www.streetauthority.com/growth-investing/forget-apple-buy-stock-instead-458387

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    “Works of art, in my opinion, are the only objects in the material universe to possess internal order, and that is why, though I don’t believe that only art matters, I do believe in Art for Art’s sake.” E. M. Forster

         
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    Posted: 29 June 2011 12:41 PM #27

    Several comments:

    1. Since when is FUD an acronym for anything but Fear, Uncertainty and Doubt in this context? Either that or Female Urination Device, according to Wikipedia. (No, you don’t want to know…) Apple’s competitors and haters have been spreading FUD for as long as I can remember. http://en.wikipedia.org/wiki/Fud
    2. Call me crazy, but I would not be surprised if Apple listened to its customers in this case, and actually resumed sales and support for the real FCP while it figures out whether to fix the new version, reposition it or ditch it. I’m sure they are tracking the complaints and comments.
    3. Is this what happens without Steve in daily command? Not a good sign, if so.
    4. Remember reading about that meeting Steve had with the MobileMe team? The FCP team better make sure their flak jackets are at the ready.

         
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    Posted: 29 June 2011 12:47 PM #28

    @craigf

    Yes I am thinking that Steve did not sign off on FCP X. Continue to sell the previous version for a year or so until FCP X has evolved in to something that is better..

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  • Posted: 29 June 2011 12:51 PM #29

    Bosco (Brad Hutchings) - 29 June 2011 03:24 PM

    Actually, that was a pretty balanced assessment from Blodget. His two main contentions are that Android kicked Apple’s butt in phones (true by numbers) and that mobile is becoming a platform game. The latter is also fairly true, and while the Android platform is quite heterogenous, developers who see it as “fragmentation” on the API side will also see it as competitive opportunity on the sales side.

    As per usual you are grabbing the wrong end of the stick.

    My main complaint was Henry claiming that the loose coalition that is Android was leaving Apple in the dust when we don’t have any actual figures of how Apple is doing currently. Save that it look Android leveled off somewhat on Verizon when the iPhone hit. That was the FUD part of the argument.

    It also depends really on what you mean by kicked butt - I don’t think there is a single Android phone that has outsold the iPhone as yet, and as I said in my comments on the original post the pro Android press likes to imply that it is the top end phones that are selling in high quantity whereas in fact it is the people buying whatever is the cheapest to replace their old phone that is getting these numbers.

    Bosco (Brad Hutchings) - 29 June 2011 03:24 PM

    I’ll admit, Apple makes excellent hardware. And its software is very good too. The problem for Apple is that Android hardware and software is more than good enough, even for normal people. Apple’s appeal is to aesthetes, not idiots.

    Good enough maybe - but still not there on tablets… In their urgency to deliver something - anything in this space Google misfired. Universally it has been Honeycomb that has taken the criticism for the batch of me-too tablets that have hit the scene so far.

    Bosco (Brad Hutchings) - 29 June 2011 03:24 PM

    Back on platforms… Apple’s main platform fight so far has been against Flash, not Android. And that probably resulted in the industry coalescing around Android. What Apple will have to do to take on Android is embrace Flash and allow software from sources other than the App Store. Because lack of Flash and side-loading is now an additional “cost” of buying into Apple’s aesthetic. Anyone with half a brain realizes this now, even if they still have to front for Apple to be in good fanboy standing.

    And yet it doesn’t make a ha’pence of difference. If Flash is all important why have both Adobe and Google produced tools to convert Flash to HTML 5 recently - Google’s product emerged yesterday. Seems like the market is moving Apple’s way on this.

    Bosco (Brad Hutchings) - 29 June 2011 03:24 PM

    And this leads to the FCPX reaction. Pros are telling Apple that they’re fine with Apple being all Apple with the iOS toys, but are not going to tolerate this “futuristic vision” crap on Macintosh or the pro tools they depend on. Vision does not pay the bills. The Mac video stack used to, handsomely. It’s not clear whether it will continue to do so. See also: Xserve.

    It’s been said before, Apple may have pissed off 5,000 customers but they are aiming at the 5 million. If this kind of knee jerk reaction had been all important Apple would have released an iMac with a floppy drive.

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    Posted: 29 June 2011 01:33 PM #30

    rattyuk - 29 June 2011 03:51 PM

    It’s been said before, Apple may have pissed off 5,000 customers but they are aiming at the 5 million. If this kind of knee jerk reaction had been all important Apple would have released an iMac with a floppy drive.

    Written like a card-carrying fanbot.

    (1) Inexpensive third party USB floppies were available shortly after the introduction of the iMac and saved countless people’s asses who had content on floppies that they needed to access on their iMacs. Old FCP is no longer available for purchase. So if you need to add FCP seats to your business, you are SOL if you don’t like the new garbage or it doesn’t work with your workflow.

    (2) The rep that Apple is earning for being “not good tools for business” is different from the one it had with the same name in the mid 1990s. Back then, it was about not having the staple tools available. Today, it’s about having product lines that are best in class that professionals don’t just buy, but design their processes around, and then pulling the rug under said professionals and their investments. On the software side, Adobe has done a much better job ensuring process continuity for its pro customers than Apple has over the last decade, and yeah, that came at the expense of not jumping on every new Apple thing immediately at Apple’s command.

    (3) The smugness of Apple’s official response through iPhone wife beater Pogue illustrates that Apple didn’t even trial run this crap on the pros that depend on FCP. The most glaring omission by Apple was a bridge to existing projects! FFS! The second most glaring omission was simply working seamlessly with storage were pros have put a lot of money into equipment and time honing their processes. Unbelievable.