I believe it will be the must have gadget for 2007. Analysts though are saying that it is perfectly priced at present.
Listen to Steve Jobs presentation at the MacWorld presentation and here's the news. Boy the stock was on fire last night!
http://www.apple.com/iphone/
http://www.engadget.com/2007/01/09/live-from-macworld-2007-steve-jobs-keynote/
Apple Computer (AAPL):
92.13 +6.65 In the worst kept secret in tech land, today Apple announced the highly-anticipated iPhone at the annual Macworld Expo conference in San Francisco. Speculation over what had become almost a phantom product had reached a fevered pitch heading into the week-long Consumer Electronics show. Expectations were running high given Apple's historical record of bringing truly innovative, intuitive, and market-changing products to life. Apple was up to the challenge once again, as the tech giant released the iPhone, which functions as an iPod, a phone, and an Internet mobile communicator.
While Bill Gates may have been the keynote speaker at the CES show in Vegas, Steve Jobs stole the spotlight from a hundred miles away. The new device has a black 3.5" screen with 160ppi resolution that operates without any buttons or stylus through a proprietary touch-screen technology called "multi-tuch". The device is bigger than the iPod, but thinner than its competitors, like Motorola's (MOT) "Q," at 11.6 mm, offering 8 GB of storage and a 2 megapixel camera. There is only one button on the face of the device called "home," with the rest controlled by finger-touch. The device, which works horizontally and vertically, will be offered by Cingular.
Consumers can not only watch movies and TV shows and listen to music on the iPhone, but they can also utilize the phone functionality in a much more effective way (with email, conference calls, etc). The icon-functional device also supports so-called push email from Yahoo! (YHOO), similar to RIM's (RIMM) Blackberry. The "phone" runs on OS X, enabling multitasking, networking, power management, graphics, security, video, graphics, and audio core animation.
Jobs also decried slowing iTunes sales rumors, stating the content conduit has been selling over 5 million songs per day - that's one every 58 seconds. iTunes has now surpassed Amazon (AMZN), ranking #4 in music sales. Its movie venture with Disney (DIS), a suggested holding in the Briefing.com Active Portfolio, has yielded superior results, selling 1.3 mln movies on iTunes since its launch. It has also added Paramount as a new partner.
The overwhelming response to the converged product was unanimous. Apple's shares skyrocketed, up more than 6%, on expectations that the iPhone could increase sales by more than a billion dollars. Total sales for the fiscal year ended in September were $19.3 bln. The iPhone will compete directly with Motorola and Nokia (NOK) for share of the $127 bln cellphone market. The iPhone gives Apple a greater market opportunity as part of its integrated product model that includes iTunes, Mac, iTV and now the iPhone.
Bank of America and UBS estimate Apple could reach nearly 5 mln units this year. The 4-GB version will sell for $499 with an 8 gigabyte device for $599. Expectations are already running high for the device given the fact that since its release, the iPod has garnered nearly 80% of the global MP3 market. According to Telephia Inc, almost 20% of all new phones sold to US consumers in the third quarter were able to play music.
Jobs also confirmed Apple TV (codename iTV) - a digital set-top box of sorts providing consumers with a central hub for their digital content and playback - a critical product in its own right for Apple as part of the digital home. While retaining our long-term bullish view on the stock, we would be hesitant in adding to positions given the fact that shares appear priced to perfection at this point.
