Perception of Apple rides on anticipation for 'great stuff'

Perception of Apple rides on anticipation for 'great stuff'

Summary: "We're working on great stuff," says Apple CEO Tim Cook, who dangles new product category hints to buy more product development time.

TOPICS: Mobility, Apple, iPhone

Apple CEO Tim Cook knows how to play the media and investor relations game well as he battles perceptions that the company may be out of tricks and lost its innovation mojo and pesky investor Carl Icahn, who aims to manufacture a higher stock price to cash in.

In an interview with the Wall Street Journal, Cook said that Apple bought $14 billion of shares in the last month. First, Cook is signaling that Apple shares can go higher, but the real reason for the spending is so the company can say it is generating shareholder value and keep Icahn in check. Icahn dabbles in tech and usually offers big plans that don't make value behind his own portfolio.

Graphic via Ed Bott


But the real message delivered in Cook's interview is that Apple will enter a new product category this year. The two favorites in the tech prognostication game revolve around an iWatch or iTV. Cook said:

"There will be new categories. We're not ready to talk about it, but we're working on some really great stuff."

For Cook, he has to keep dangling nuggets like that because there are worries about whether Apple can innovate going forward. The worries are unfair in many respects. Can we realistically expect a company that reinvented product categories with the iPod, iPhone and iPad to strike gold repeatedly? The odds say no.

Ed BottApple, Google, Microsoft: Where does the money come from?

But the broader picture is that there are worries about smartphone fatigue and Apple ability to preserve margins. Apple has stayed out of the bargain bin fray in smartphones and has paid the market share price to some degree. Frankly, I'd take profits over market share all day. There's a reason Google, IBM and Sony are bailing on commodity hardware.

For Apple to avoid that profit margin mess in the smartphone and tablet sectors it'll need new product categories. And for us to have patience while Apple cooks up those new products, Cook needs to dangle a few carrots from time to time. Comments about new and great stuff will hold the fort for a bit longer.

Topics: Mobility, Apple, iPhone

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  • All Talk No Action

    Tim Cook is all talk no action and he is losing respect if you ask me. You can only coast along so far on past accomplishments. I think innovation for Apple is turning into desperation, partly his own fault because of the false hype and delusions of grandeur.
    Sean Foley
    • Me thinks...

      You are describing Microsoft not Apple.
      • Above

        Hey did you know there's a whole article above that talks about Apple desperation. The stock buyback made it clear. Try reading...
        Sean Foley
        • unfortunately greedy...

          shareholders such as Icahn want more return on their shares.

          One way to increase shareholder value is to buy back shares. A lot of publicly traded companies have used this method and is not unique to Apple.

          Tim Cook would not try to miss lead shareholders and the market as he would be open to possible law suits.
          • Who says he's misleading shareholders?

            by saying "we're working on great stuff" all Apple has to do is throw out a 32" monitor with Retina display, and who's to argue that isn't "great stuff"?,

            As long as they don't oversell some product in particular they don't deliver on that effects the stock price, they can work on all the "great stuff" they want, even if the shareholders don't see it as great.

            Do you think companies and stores tell customers, "we make lots of OK products"? "We have good products in stock"?

            No they tell everyone "great products at great prices", as "greatness" is in the eye of the beholder.

            So they can say they're working on "great stuff", as who's to say the products aren't?
          • He is a director...

            If a director of a company makes a statement that gives the impression that forth coming products will potentially maintain or increase the value of his or her's company and it doesn't, then they are open to possible law suits by miss leading shareholders.

            It is of my opinion that Tim Cook has through the media given the impression that forth coming products will continue to generate the revenues that the markets expect. If Apple fails to deliver then they could be open to law suits by share holders.
          • It's "mislead," not "miss lead"

            Who is this Miss Lead person? Is she an apple Director?
          • Some say women are poison

            But this "Miss Lead" woman really *is*. And once exposed to her , you'll never get her out of you're system.. except by chelation ;-)
            Nick Ettema
          • Nah mate, Miss Lead is *wait for it*

            The real "Loverock Davidson."
          • LOOK EVERYONE!!! HE MENTIONS ME!@!@#@!!

            Woo hoo!
          • Never type his monicker

            Just like in the Harry Potter books.
            John L. Ries
          • As long as he doesn't lie, they're absolutely fine.

            "If a director of a company makes a statement that gives the impression that forth coming products will potentially maintain or increase the value of his or her's company."

            They all do that . Isn't that called "business"?

            Seriously, what business builds or plans or announces products under the pretense or idea that they WANT it to decrease the value of their company?

            If they don't think new products will maintain or increase the company value, then they do one simple thing - they DON'T build it.

            That's totally different then building a product they think will be a big money maker that wasn't. If they didn't think it a great product why waste money on it? If they didn't think it was great, they wouldn't tell people they think it's great.
          • But the way to stay out of court...

   to be very clear about one's plans when disclosing them to the public, so as to properly manage expectations. Saying things that are technically true but potentially misleading is a good way to get sued, and should be.

            Steve Jobs had a habit of keeping his mouth firmly shut regarding future products, until he was ready to announce them, which is one way to stay out of trouble.
            John L. Ries
          • what apple did well

            Apple looks at new technologies and then redisigns them to be ergonomic and clever and then uses an amazing hype machine to popularize the item. Eg smart phones and MP3 players and tablets all existed before Apple got involved, but in all three cases Apple was able to create spiffy designs and hype them up.

            Problem is - none of us see what is new out there for Apple to copy. Who is going to come up with the next "Palm Pilot" for Apple to feast on.

            A new monitor may be wonderful - but it sure is not sexy the way the iPhone and iPod used to be. And the rest of their lineup is looking dated. I really hope "wonderful" isn't just slapping a 5" screen on the iPhone.
          • You're close, but not

            in the bullseye. What Apple does is take something that exists, but sucks and re-engineers it so it doesn't suck anymore. So, if you want to see where Apple is going next, find something that people would love to buy and use if it just didn't suck so much.
          • My personal vote is

            cable TV. People love Cable. They hate having to buy the cadillac package just to get the two or three channels they want. People want a cafeteria plan, where they can pick and choose the channels they want and let the rest go. Kind of like how iTunes broke the Album chokehold (having to buy an entire album of crap to get the one or two good songs you actually cared about having).
          • Don't they call that

          • Yes, except...

            Netfilx is limited in their content. I would like to get H2, since the History Channel is filled with reality shows (which I don't like and often have little to do with history). But the local cable company only bundles it with its "sports and information" package. I don't follow sports. Why would I pay for several sports channels to get that one?

            Sometimes, I like to just discover something that's on when I'm in a mood to watch TV. Although Netflix does have algorithms to find shows that might interest me, it isn't quite the same thing. Especially since I don't have the time to binge watch.
          • Ya

            Look at Frodo Baggins'z throwing down the gauntlet!
          • One game to play

            Is to look for things in his posts that would have annoyed Tolkien (who was very conservative, but not of the modern populist variety). He does that every once in a while.
            John L. Ries