Apple has hinted at a new, cheaper spin on the iPhone and hit out at rival Samsung's screen quality.
CEO Tim Cook delivered a keynote interview at a packed Goldman Sachs Technology and Internet conference yesterday, which was transcribed by The Wall Street Journal. Despite record revenues and profits, Apple has been under pressure to bring new devices to market and also return cash to shareholders. While there was no mention of the so-called iWatch, which Bloomberg reported has a team of 100 people working on it, Cook did hint at making its phones more affordable. When asked about a cheaper iPhone, he said: 'If you look at what we've done to appeal to people who are more price sensitive, we lowered the price for iPhone 4 and iPhone 4S, and in the December quarter, we didn't have enough supply of iPhone 4, so it suprised us as to the level of demand we had for it.'
He said the company has had a history of bringing out new devices to satisfy demand for cheaper products, pointing out how the more affordable iPod Shuffle followed the iPod and iPad followed the iMac. He said: 'Instead of saying how can we cheapen this iPod to get it lower, we said how can we do a great product, and we were able to do that. The same thing, but in a different concept in some ways...Sometimes you can take the issue and you can solve it in different ways.'
Apple was recently criticised as having 'a depression era mentality' by hedge fund investor David Einhorn for holding onto its vast $137bn cash pile. Cook countered this, arguing it was making, on average, an acquisition a month. He said: ' If you look at what we've done in terms of investment, last year we invested $10 billion in CapEx. We think we're gonna do a similar amount this year. We're investing in retail around the world, in product innovation, in new product, in supply chain. We're acquiring some companies. My definition of a depression-era mentality wouldn't be of a company investing a pair of tens over two years.'
He also threw a barb at rival Samsung over the quality of its Oled screens. When quizzed about the rise of phablets, which has been driven by Samsung's Galaxy Note category, Cook said: 'When you look at displays, some people are focused on size. There's a few other things about the display that are important. Some people use displays, the color saturation is awful. The Retina display is twice as bright as an OLED display. I only bring these points up to say there are many attributes to the display, and what Apple does is sweat every detail.'
Among the other highlights of the interview was Cook revealing Apple has paid $8bn to developers. He said the business was continuing to build momentum amid growing competition in the smartphone and tablet sphere, with 40% of the 500m iOS devices activated in 2012. He said the business was planning to close 20 stores to revamp and make them larger. Apple is also planning to open a further 30 branches, which will result in it trading in 13 countries.
Author: Graeme Neill