Apple would have been much better off had it merely released the new iPods and iPhone without any sort of media event. You don’t invite the global press to an event to show off iPods and an iPhone that look exactly like their predecessors. Apple certainly underwhelmed the market in the short run. Wall Street wanted Apple to call this new phone the iPhone 5, but CEO Tim Cook obviously wasn’t ready to make the necessary hardware and design changes.
Take a step back from the short run and everything will be fine. The good news is that the iPhone 3GS will be offered for free, the iPhone 4 will be available for $99 and Apple will sell over 30 million iPhones in the holiday quarter. These iPhone release events have turned into one-day nightmares for shareholders, but the good news is the nightmare doesn’t last. In fact, it looks like capitulation already took place, and Apple will experience a seasonal rally.
Beyond the hardware and software upgrades, I believe a defining moment took place during Tim Cook's introductory speech. You could sense his excitement and enthusiasm as he showed the slides revealing 23% market share for the Mac and 5% market share for the iPhone. The room for Apple growth remains exponential on the global stage.
The reason this moment sticks out to me is because it captured the essence of Tim’s purpose at Apple. He is the operations guy. His legacy will be defined by his ability to take what Steve Jobs built and catapult these Apple products into the realm of critical mass. From this perspective, Tim Cook is the perfect choice to be the CEO of Apple.
The days of glitz and glamor at iPhone events might be few and far between, but the era of market share gains is still in its infancy. The era of Chinese growth has just begun. The global movement towards smart phones and tablets is a generational revolution, and Tim Cook has Apple perfectly positioned to reap the ben! efits. Tim remarked that he had watched the presentation video of the Chinese retail store openings 100 times, and he could watch it 100 times more. This guy has his eye focused on what matters most.
Disclosure: I am long AAPL.
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