Thanks for the suggestion. But no.

Posted October 18, 2006 By The Macalope and has 10 comments.

Gartner: Apple should quit hardware business. (antler tip to David Seo via email.)

Gartner says the move should be made because Intel currently gives Apple favorable pricing that it won’t be able to maintain.

A few thoughts occur to the Macalope about this:

  • Intel may be well-incented to retain Apple as a customer for marketing and prestige purposes (having both Windows and OS X running on Intel).
  • Apple has larger margins to cut into than Dell or HP. If anyone can take price pressure, it’s Apple.
  • Apple customers are used to paying a little more for what they consider to be a better product.
  • Apple makes the whole widget… Apple makes the whole widget… Apple makes the whole widget…

So, the Macalope doesn’t see it happening.

That said, there is a demonstrable difference between openly licensing OS X and outsourcing/selling the Mac business to another hardware manufacturer. The latter is far more likely than the former, but still rather unlikely.

[Added the word "openly" as the Macalope was trying to allude to the licensing of the 1990s with multiple licensees competing against Apple but didn't make that point clearly.]

One man's opinion

By The Macalope and has 3 comments.

Several Mac news sites are reporting on Gene Munster of Piper Jaffray’s analysis claiming Jobs is in the clear on the stock options issue.

Not to throw cold water on any potential wood being sported for this report, but Munster is about as close as you can get to an Apple fanboy on Wall Street.  Not that he’s wrong (he’s probably more often right than his competition), but he seems to have a general inclination to be bullish on Apple.

Also, Munster really offers no new information other than this (see MacObserver for a chart):

The analyst said that of the 15 grants in question,  one was at the low for the 40-day trading range, three were within 5 percent of the low for a 40-day trading range, and three were within 10 percent of the low for the fiscal year.

And that’s just more detail on the options in question which we already knew were “irregular.”  Beyond that, it’s really just Munster’s opinion.

Among other issues, Piper Jaffray noted that one of the grants in question was given to Mr. Jobs in January 2000 but was canceled March 2003, resulting in no financial gain to Mr. Jobs.

This is a matter of interpretation.  Jobs was given directly owned shares at essentially a replacement value for options with a favorable strike price that were improperly reported.  How that’s of “no financial gain to Mr. Jobs”, the Macalope is unsure.

Bam

By The Macalope and has 4 comments.

Monster quarter for Apple.  1.61 million Macs (biggest quarter ever) and 8.7 million iPods.

If you’ll remember, the Macalope made a conservative bet of 8.1 million iPods and he’s happy to be wrong.

And, for the silly pundits who like to compare quarter to quarter, 8.7 million in iPod sales is Apple’s second-best quarter ever.  Up year-over-year and from the previous two quarters.

Also, in a positive sign, the company apparently did provide at least some guidance for the current quarter.  Matt Deatherage had posted about concerns (antler tip to Daring Fireball) earlier that the options problem might make that impossible.

Dear Apple…

By The Macalope and has 11 comments.

The Macalope loves his Macs. He loves their design. Their simplicity.

He loves their smell. Their touch. Their taste.  Their warmth in the middle of the night.

And he loves it that they don’t force him to reinstall the operating system every X number of days to get rid of viruses and malware (maybe there are other ways around this, but the Macalope knows many Windows users who resort to this).

The Macalope started thinking about security the other day when he read this article on ZDNet Australia (antler tip to MacSurfer).  He was all set to lay into it as part of his ongoing war against silly pundits, but the more he read, the more air was let out of his balloon of outrage (“Ballons of Outrage” come ten to a bag – ask for them by name at your local five and dime).

It’s true, there’s a lot to complain about in this piece. The lead-in referencing a system compromise that was only made possible by third-party software. The appearance of Artie MacStrawman (“OS X didn’t somehow, magically, prevent the attack as some users seem to think it’s capable of doing.”). The absurd idea that it’s “time to admit” anything, as if Apple should hang its head, kick at the dirt and say “I’m soooooorry”.

But, ultimately, there is a valid point there.

The single biggest contributing factor to the fact that Mac users don’t currently have to worry about security is that OS X has been less of a target than Windows because of its smaller installed user base.  Mac users can go on and on about the inherent advantages of Unix-based systems over Windows, how Apple is perfect and good and the embodiment of the pure radiant light of joy that fills the universe, but that’s still the biggest factor.

Now, the Macalope enjoyed your Get A Mac ad where the PC has a virus and it only made him a little itchy around the haunches at the thought that it might raise the pale, pimply faces of hackers looking for a new challenge.

David Maynor and John (Johnny Cache!) Ellch certainly noticed. If they had decided to use their powers for evil rather than good (well, “good” isn’t really the right word… how about “self-promotion”?), then one guy in a Starbucks somewhere might have lost his user data.

Granted, Maynor may have had to shove him out of the way and replace his kernel with a custom one to make it possible but, look, the point is that there are a few important lessons to take away from the SecureWorks debacle. The biggest is don’t stick a verbal cigarette in the eye of a highly partisan user base, but another is hackers are starting to notice the Mac.

You, Apple, apparently did not get that message as yesterday you decided to take a long drag off that verbal cigarette and make it nice and hot.

Hey, it was great that you got out ahead of this and announced the problem before it was all over the Internet.  And we all love a good jab at Windows – preferably something below the belt.

But shipping virus-infected iPods was your mistake.  Not Microsoft’s.  James “Randy” Abrams (the Macalope would rather not know how he got that nickname) is correct in saying:

The Apple iPod incident was not about Microsoft having a hardy operating system, it was all about security and process.

…

That Apple would blame Microsoft demonstrates a lack of understanding of remedial security and manufacturing processes. [The] virus was only a symptom of the problem. Apple didn’t know what they were shipping.

Of course the person who wrote the press release and the people who handle your vetting of third-party production controls are not the same.  But from an organizational standpoint, the point is dead on.  The comment was irresponsible.

So, speaking as a Mac user, Apple, the Macalope would really prefer it if you cut the crap.  How about being the strong, silent type on security, hmm?  No one needs any apologies (particularly Steve “iPod Users Steal Music” Ballmer).  But it’s one thing to have someone else slap a “hack me” sign on your back and it’s another to put it there yourself.

Love always,
The Macalope

Phil Schiller invented the wheel

Posted October 17, 2006 By The Macalope and has 7 comments.

Leander Kahney on the birth of the iPod:

The idea for the scroll wheel was suggested by Apple’s head of marketing, Phil Schiller, who in an early meeting said quite definitively, “The wheel is the right user interface for this product.”

The Macalope’s not sure he buys all the elements of the story. Toshiba built those little hard drives and didn’t know what to do with them? Does that make sense?

Apple files for iPhone trademark

Posted October 16, 2006 By The Macalope and has 5 comments.

AppleInsider reports that Apple has filed for a trademark on “iPhone.”

The filing, made last month with a Far Eastern trademark office, is the latest in a long list of incontrovertible evidence to suggest the Cupertino, Calif.-based iPod maker is in the final developmental stages of the project, which is expected to merge traditional cellular capabilities with an iPod digital music player.

“Incontrovertible!”

“You keep using that word.  I do not think that it means what you think it means.”

(What is it with the movie quotes today?  Beats the Macalope.)

Now, the Macalope believes in the iPhone, but “incontrovertible”?

The trees are dead and gone, but the sap is still running

By The Macalope and has no comments yet.

Brilliant legal professional David Burke (of George Ou fame) stops by to respond to a post the Macalope made about the SecureWorks controversy…

…over two weeks ago.

The Macalope couldn’t decide which of the following movie quotes was most applicable so he’ll leave you with both:

“You’re still here? It’s over!”

“Coach woulda put me in fourth quarter, we would’ve been state champions. No doubt. No doubt in my mind.”

A tale of two camels.

Posted October 15, 2006 By The Macalope and has 12 comments.

Larry Bodine on his conversion to the Mac in July [of 2005].

The straw that broke the camel’s back was when my computer got hacked last fall.

Larry Bodine on his conversion back to the PC today.

I couldn’t operate my own Web sites with the Mac. That was the straw that broke the camel’s back.

Right.

So, just how many camels are in your herd, Sheikh Hackneyed?

[The Macalope agrees with Ignis Fastuusz on the troll designation. And Gruber has a roundup of other comments here. But, really, this probably isn't worth your time.]

UPDATE: As Rod notes in comments, Bodine’s conversion to the Mac was in 2005, which contradicts the Law.com post which says it was this year.

Analysts revise iPod sales estimates.

Posted October 13, 2006 By The Macalope and has 4 comments.

MacNN reports that Merill Lynch is cutting its iPod sales estimate for Apple’s fourth fiscal quarter from 8.3 million to 7.7 million, following cuts by Piper Jaffray and UBS yesterday.

Merill Lynch’s estimate would still be a 20% increase year-over-year, but a rather precipitous drop from the previous quarter’s 8.111 million.  Piper Jaffray’s Gene Munster and UBS’s Ben Reitzes had rather more optimistic estimates of 8.2 million and 8.12 million respectively.

The Macalope doesn’t have access to the monthly data, but Merill’s estimate seems a bit conservative.  Munster indicates that without the revised lineup, their estimate would have been 7.4 million for the quarter, so Merill’s saying there was only 300,000 in pent-up demand (yeah, different analysts, but they all already have the actual numbers for July and August, so their estimates for the quarter without the revised lineup shouldn’t be that different).

The Macalope’s going to go with 8.1 million, siding with Munster and Reitzes but hedging his bet a little.

All of the analysts predicted stronger than anticipated Mac sales.

Wishes still != ponies.

By The Macalope and has 6 comments.

Boy, the Macalope gets accused of being an Apple apologist, but you people take the cake. The “We got Steve Jobs’ back!” excuse du jour seems to be “There’s nothing wrong with backdating as long as it’s properly accounted for and reported!” (See comments here.)

Well, before you take that excuse and get all Diggy wit’ it, a couple of things.

First, it is illegal if it’s against Apple’s bylaws. The Macalope did some searching but couldn’t find Apple’s bylaws online.

He did find the complaint filed by Keller Rohrback, a firm representing Apple shareholders in the options suit:

The Complaint alleges that the defendants breached their fiduciary duties and colluded with one another to: (1) improperly backdate grants of Apple stock options to various Apple executives in violation of the Company’s shareholder-approved stock option plans; (2) improperly record and account for the backdated stock options in violation of GAAP; (3) improperly take tax deductions based on the backdated stock options in violation of the Tax Code; and (4) produce and disseminate to the Company’s shareholders false financial statements and other SEC filings that improperly recorded and accounted for the backdated option grants thereby concealing the improper backdating of stock options.

Now, the Macalope isn’t advising you just take the plaintiffs’ word for it, but their contention is that Apple violated the terms of its “shareholder-approved stock option plans.”

Just because backdating is OK at some companies, doesn’t mean it’s OK at Apple.

Second, the Macalope would suggest you take a look at Apple’s August 3rd SEC filing, in which the company stated:

On August 3, 2006, management of Apple Computer, Inc. (Apple) concluded, and the Audit and Finance Committee of Apple’s Board of Directors approved the conclusion, that Apple’s financial statements for the fiscal years ended 2003, 2004 and 2005, the interim periods contained therein, the fiscal quarters ended December 31, 2005 and April 1, 2006, and all earnings and press releases and similar communications issued by Apple relating to periods commencing on September 29, 2002 should no longer be relied upon.

(Emphasis the Macalope’s)

So, regardless of whether or not it violated Apple’s policies, it was not properly accounted for and not properly report.

If you want to convince yourself that all the other backdated options weren’t properly accounted for but Steve’s were, that’s fine. But the Macalope would point out that when you stick your head in the sand that far, it’s probably going to get in your ears and muss up your hair.

The Macalope holds an inconsequential number of Apple shares and, sigh, did some contracting for Keller Rohrback in the early 1990s on an entirely unrelated matter. He didn’t know they were counsel on this until he Googled up that complaint. And, no, the Macalope is not “legal professional” David Burke. Please.