I watched most of the Apple Inc. (NASDAQ:AAPL) presentation. It was probably the most boring presentation from Apple Inc. (NASDAQ:AAPL) I’ve ever seen, not because of the products, most of them were incredible, but rather the numerous leaks proved correct and therefore there were zero surprises.
What I found concerning as an Apple fan and shareholder was the iPod Nano. It was a complete change in design and looked like the Nokia Lumina 900 with its separate border colour. They even changed the icons to be rounded! Why would they ever think that was a good idea. The reason people stick with the Apple ecosystem is because it is easy to understand and they are familiar with it. I just don’t feel the design changes would have happened under Steve Jobs, and it’s a red flag over their future design strategy.
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I’m still long Apple Inc. (NASDAQ:AAPL) but I have been reducing it. The bear case in my mind remains margin compression, due to the quality of their competitors products. Let’s be honest, when the iPhone was introduced it was a major innovation, now the Android phones have caught up and are comparable in many ways; pricing will come under pressure and margins will decline, at least on their existing products.
Why am I still long? A very low valuation, and a great ecosystem with strong customer retention, which gives the company a competitive advantage in launching new products.
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