Have The Missing iPhones Been Found?
01.29.08 - 02:06pm
Ever since Steve Jobs announced in his keynote address at Macworld that the company had sold 3.7 million iPhones analysts everywhere have been crunching the numbers and coming up with a differentiation between Apple’s numbers and the cell phone’s companies activation numbers. A 1.4 million differentiation.
What happened to the phones? First it was believed that they were stuck in stores backlog inventory waiting to be sold. Now after careful research by Gene Munster of Piper Jaffray and A.M. Sacconaghi, Jr. of Sanford C. Bernste the thought is that the iPhones are out there, sold and unlocked.
Munster monitored Apple stores in New York, San Francisco and Minneapolis and reported that 40% of the people buying the phones were buying 2 at a time. He also said “The majority of the people who were buying more than one phone were Asian, and they were bringing small buses of people who all buy more than one phone.” Conclusion was simple. They were taking the phones back to Asia, unlocking them and using them there.
Munster believes that 512,000 are in inventory with 838,000 unlocked. Sacconaghi arrives at slightly different numbers with fewer phones in inventory and 1 million unlocked.
Good and bad news for Apple. Bad in that they miss the monthly revenue fee on unlocked models, good in that it shows that the phones do have a high demand and hitting the 10 million mark by the end of 2008 should happen. Munster and Sacconaghi also believe that in spite of the loss of some revenue on the over 1 million missing iPhones, Apple is still making a “huge” profit.
“Stock analysts have been paying lots of attention to the iPhone numbers,” said Ezra Gottheil, an analyst at Technology Business Research Inc., “and clearly the revenue [mobile service] providers give back to Apple affect profitability. But if you look at Apple, it’s solidly profitable without the iPhone. The iPhone just takes it up to another level.
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