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Steve Jobs Taking Second Medical Leave of Absence
This past Monday, Steve Jobs announced a second medical leave of absence from Apple. In a companywide email published on the company’s “*PR page*”http://www.apple.com/pr/library/2011/01/17advisory.html Jobs announced the following:
__Team,__
__At my request, the board of directors has granted me a medical leave of absence so I can focus on my health. I will continue as CEO and be involved in major strategic decisions for the company.__
__I have asked Tim Cook to be responsible for all of Apple’s day to day operations. I have great confidence that Tim and the rest of the executive management team will do a terrific job executing the exciting plans we have in place for 2011.__
__I love Apple so much and hope to be back as soon as I can. In the meantime, my family and I would deeply appreciate respect for our privacy.__
__Steve__
The expected duration of this leave is unknown, but Jobs makes it evident he plans to maintain his role as CEO. When Jobs underwent a liver transplant in 2009, Tim Cook oversaw Apple’s day to day in the interim. As the announcement is still new, it is unknown whether the complications Mr. Jobs has encountered with pancreatic cancer in the past are connected to his current ailments.
The App Store is About to Hit Ten Billion Downloads
As of this morning, the App Store is just 20,000,000 shy of its ten billionth download, and that folks, is a lot of “*Angry Birds.*”:http://click.linksynergy.com/fs-bin/stat?id=19XpSnZWhPI&offerid=146261&type=3&subid=0&tmpid=1826&RD_PARM1=http%3A%2F%2Fitunes.apple.com%2Fus%2Fapp%2Fangry-birds%2Fid343200656%3Fmt%3D8%2526uo%253D6%2526partnerId%253D30
If a cool twenty mil seems like a large number of remaining downloads, get this: according to Apple, 350 apps are being downloaded every second! Considering the store is just over two years old, only serves to make this number more impressive. The iTunes Music Store by comparison opened in the Spring of 2003, and just surpassed the ten billion mark last February.
The App Store has grown to be one of Apple’s most lucrative platforms ever, benefiting both the company and the developers behind the apps immensely. The diversity of offerings in the store arguably drives the incredible popularity of iOS devices such as the iPad, and Apple has taken notice. As a way of expressing its thanks, the company is giving away a $10,000 iTunes Gift Card to whomever downloads the 10 billionth app.
As the store is predicted to achieve this milestone by the end of the day, Apple has updated its homepage with a ticker counting off the downloads. As the lucky download draws nearer, it’s likely the frequency of downloads will only increase.
According to the Calculator app, if the number stays at exactly at 350/second, the ten billionth download is under 16 hours away. Contests such as these have the potential to propel a relatively small developer into the spotlight if their app is the milestone download. This was the case with “*Bump*”:http://click.linksynergy.com/fs-bin/stat?id=19XpSnZWhPI&offerid=146261&type=3&subid=0&tmpid=1826&RD_PARM1=http%3A%2F%2Fitunes.apple.com%2Fus%2Fapp%2Fbump%2Fid305479724%3Fmt%3D8%2526uo%253D6%2526partnerId%253D30 (the 1 billionth app downloaded).
Get those fingers ready people. If you time your taps right, you may not be paying for apps, music, or movies for a long long time!
Keep an eye on the ticker “*here.*”:http://www.apple.com/
_Dear Friends,_
The deep freeze is heading our way as low temps for Saturday and Sunday night may reach as low as -30 F. While those are dangerously low temperatures, I actually enjoy the noises and crisp (and I do mean CRISP) fresh air. Just walking to the car, the crunching of the snow makes a different sound when it is that cold and my house creaks and groans as if it were stretching to keep warm.
I always make it a point to take a hot tub outside on the coldest night of the year where the steam coming off the tub combines with the creaking of the house and trees and a clear sky watching for a shooting star while my hair freezes like one of those “old hats the band DEVO used to wear.”:http://store.clubdevo.com/store/product/black-pompadour-wig
The big news from Apple this week was the unprecedented financial results from the holiday quarter that shows Apple firing on all cylinders and posting numbers that were beyond the most bullish numbers from the analysts. It was all good financial news from Cupertino and I have given the highlights and analysis of the financial results below in this issue of Kibbles & Bytes.
It was also announced that Apple CEO and visionary, Steve Jobs will be taking a medical leave of absence to allow him to concentrate on his health. Steve deserves both the break from the day to day grind of leading Apple and the privacy and time to deal with his health. Apple is much much more than Steve Jobs and I think it would be very foolish to think that Apple is not prepared to thrive even while Steve is reducing his workload.
There is a very deep bench of leadership and vision at Apple and I think you will find that 2011 will be another year of innovation and record-setting performance for Apple. Who knows what Steve will cook up while he’s resting, the last time he came back from medical leave we got the iPad.
SOAPBOX: VT Leads the Nation in Health Care Reform
*Start Soapbox*
While the US House of Representatives voted this week to repeal the health care reform law, Vermont legislators heard on Wednesday from Dr. William Hsiao, Professor of Economics at Harvard and the designer of the much acclaimed Taiwanese health care system. Dr. Hsiao and his team of 20 experts were asked by the Vermont legislature to analyze the current health care system in Vermont and make recommendations on three systems to replace the current system.
Dr. Hsiao noted that the current system is broken and headed to failure despite the excessive cost of the system. His plans were a single-payer system completely operated by the government, a system with a “public option” and a public-private single payer system. His recommendation is for the third option: a public-private single payer system that would cover all Vermonters but would use existing private companies to administer the program.
His analysis shows that this could be funded with an 11% payroll tax and provide essential health care coverage to all Vermonters. Further, he demonstrated how that could save the state over $2 Billion by 2024, create 5,000 jobs, reduce employer and employee cost of insurance, attract 3,500 new residents and increase the state’s domestic product by over $150 million.
Of course, he identified several challenges and barriers to implementation; however, in the current political climate in our state with both a Governor and a legislature committed to reform, there is a very strong possibility that his suggestion or some modification of it will be adopted in Vermont. I know that our analysis of Dr. Hsiao’s proposal shows that our cost to insure our employees would drop 50%. We currently estimate about 22% of payroll to cover health insurance, Dr. Hsiao estimates a payroll tax of 11% and some percentage of that would be born by the employees. This would allow us to hire more people and to pay our current employees higher wages.
This sensible approach to health care reform simply makes intuitive sense as well as economic sense. The current “system” is nothing more than an accident of history and a Rube Goldberg contraption that is on the verge of total collapse. You can read Dr. Hsiao’s presentation to the Vermont legislature “here.”:http://leg.state.vt.us/jfo/healthcare/FINAL%20VT%20Hsiao%20Presentation%20for%20Jan1911_1.pdf
*End Soapbox*
__Have a comment?__ “Leave it on the blog here”:http://blog.smalldog.com/article/soapbox-vermont-leads-the-nation-in-health-care-reform/ __or email me at the above address!__
POLL: Verizon iPhone 4?
We want to hear from you… click through to the poll on our blog now to let us know if you plan on getting an iPhone 4 from Verizon.
“Vote now!”:http://blog.smalldog.com/article/4290/vote-are-you-getting-a-verizon-iphone-4 (voting ends at noon ET on Wednesday)
Apple Mangles the Street!
Apple released their financial results for the holiday quarter (Oct-Dec), and once again, they posted both record revenues and record profits. The company had $26.74 billion of revenue for the three months, which is over $11 billion more sales than the same period last year. Their profits were also up as Apple made $6 billion in profit (I remember not too long ago, that Apple’s stated annual goal was $5 billion in sales!). This profit was nearly double the $3.38 billion last year.
Apple sold 4.13 million Macs during the quarter. That is simply an amazing number and represents an unparalleled growth of 26% year-over-year. They sold 16.24 million iPhones, which is an 86% growth and that is before expanding their market to Verizon. iPod sales were down 7% in unit sales but Apple sold 19.45 million iPods and maintain a massive market-share lead in the music player business. Of note was that iPod touch sales were up 27% year-over-year.
The new iPad also had stellar sales with over 7.33 million iPads sold during the quarter. Apple could have done even better if it had not had some inventory shortages towards the end of the quarter, especially with iPhones and iPads. Overall, there have been over 160 million iOS devices sold–an astounding number for a new operating system.
Apple’s cash stash increased by about $10 billion and they were left with about $60 billion in the bank and no debt at the end of the quarter. During the conference call, Tim Cook referred to spending some of that money to secure long term supply contracts on some unidentified key components.
Apple’s initiatives internationally, especially in China, resulted in about 62% of this quarter’s revenue being generated by international sales.
There were questions about whether the iPad is cannibalizing Mac sales. Clearly with a 26% increase in Mac sales that does not seem to be the case; this is about 8 times the growth rate for any other computer manufacturer. With Apple’s market share still hovering around 10%, there is a lot of room for iPad, iPhone and iPod sales to generate the “halo” effect that gives buyers exposure to Apple’s products and stimulates Mac sales. Tim Cook said, “so if this is cannibalization, it feels real good.”
Apple guidance for the next quarter is $22 billion in sales and earnings per share of $4.80. This represents guidance of 50% growth year-over-year, which is simply unprecedented. Apple sees increases in iPhone sales and declines in Mac, iPad and iPod sales as is the historical trend coming out of a holiday quarter.
The other remarkable news from Apple with these financial results is that the iPad is driving enterprise penetration. Over 80% of large companies are deploying or piloting iPad use at their companies.
The most incredible story in the history of American business continues to write history. As Steve Jobs takes a leave of absence to deal with his health, it is clear that an important part of Steve’s genius is that he has (as Tim Cook puts it) “driven a culture of innovation into the company and excellence has become a habit.” Those that clamor for a more defined “succession” plan simply do not know Apple.
First off, Tim Cook is as responsible as Steve Jobs for the phenomenal success of Apple. I have seen the nitty-gritty of Apple in terms of inventory planning and basic operations both before Tim and after Tim and it is a night and day difference. Tim Cook is just one of the very deep Apple management bench and is a world-class CEO on his own.
Congratulations to the entire Apple team for yet another stellar and unprecedented quarter of growth and excellence. Apple’s innovation, design and business continue to show the world how it is done and we cannot be prouder to be an Apple Specialist.