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Technology Stocks : Apple Inc. -- Ignore unavailable to you. Want to Upgrade?

To: slacker711 who wrote (102912)	9/12/2010 3:00:53 PM
From: Cogito	Read Replies (1) \| Respond to of 213173

>>Yes, I absolutely 100% believe that if there was no Android that more people would buy iPhones. Anecdotally, I know that it is true among people that I know and I would be a bit surprised if it wasnt also true among people that you know. More broadly, I do think that it is axiomatic that the better the competition is, the fewer people will decide to buy your product. No company operates in a vacuum.<< Yes, I do know people who might have bought iPhones, but chose Android phones instead. Or Blackberries. Or Symbian phones. Yes, of course, competition matters. I still think there's some room to refine our thinking about how much Android will affect Apple's margins "materially," and how different that is from "margins will fall through the floor". Based on what I've seen in iPods, and computers, Apple has pricing power that other companies haven't got, and they haven't had to meaningfully reduce margins in those areas. I just don't see how Android and the smartphone market are different. And the fact that the company is selling as many phones as they can make is not indicative only of supply constraints. Demand for the iPhone 4, even with the antenna issues and all the Android phones of the week we keep hearing about, is running many times higher than what the company saw for the 3Gs. So far, there is no pressure on Apple's margins. So when I say Apple won't have to reduce margins "materially," I mean they won't have to go from 50-60% to say, twenty or thirty percent. Earnings per share on the iPhone line are going to continue to increase, and for now, I believe the margins are safe.