as a new iphones but major issues likethe options backdating scandal still lurk in the background and ceo steve jobs today talked about itexclusively with cnbc take a look at the stock it soared on thenew product news the iphone good enough for a gain of more thaneight-percent on apple stock
Android TV jobs, apple ceo as i mentioned steve jobsspoke to cnbc silicon valley bureau chief jim coleman the first on cnbc interviewat macworld jimhey maria good evening to you indeed these are heady times for applecomputer the company is quick to point out
today that this is not merely anothercell phone but an important new product platform forapple computer changing industries in much the same way that macintosh did in 1984and then ipod in 2001 now it's iphone's turn this is anextremely important product for apple's future something i asked steve jobin this first on cnbc interview first of all you look at handsets this is probably not only the most vibranttechnology sector there is out in the globe
this is also one most competitivewhy in the world would apple computer want to jump into the handset marketwith so much competition and already so many players you know one of the biggest motivations for working so hard for a few years to make a greatproduct is you want one yourself and we use all the handsets out there and boy is it frustratingit's really frustrating it's a category that
that needs to be reinventedneeds to be made more - not only more powerful much easier to use and so we thoughtwe could contribute something and we don't mindthe fact that there's other good companies making products out therethe fact is that there's a billion handsets that were sold in 2006and so if we just got one percent market share that's ten million units and we think what we've done is to reinvent the phone and completely change what yourexpectations are gonna be for what you carry in your pocket
you mentioned in your keynote you talked about themac you talked about the ipod and now there's this what makes this such a product that would enjoy such loftycompany how important is this too apple computer and why? time will tell the mac changed the wholecomputer industry and it really make computers easy to usefor the first time and brought graphics into the personalcomputer for the first time the ipod changed the way we listen tomusic and changed the music industry
i think the iphone may really change the whole phone industryand i think gives us something that's that's vastly more powerful in terms ofmaking phone calls and keeping all your contacts on it having the best ipod we've ever made fullyintegrated into it and having the internet in your pocket with a real browser and real email and the best implementation of google maps on the planet having all the stuff in your pocket andyet having it be ten times easier to use i think this is where the world's going
you mentioned during the speech as wellyou kept coming back to it too - you kept showing the competitorsyou kept showing palm rim and nokia and motorola what message are you sendingnot only to you were immediate competitors but to the entire industrywe're financial network obviously so from an investor's standpoint i don't know if you've been seeing whatyour comments have been doing today but research in motion is getting clobberedand i would imagine the other smartphone manufactures are also feeling
an enormous amount of pressure becauseyou have now officially entered the game well you know we don't really think inthose terms we're a product company we love great products and so in order to to explain what ourproduct is we have to contrast the to what's out there right now on whatpeople use so you know that's what we do and looking at this also when you when italked about the video ipod when that finally i'm sorry the ipod that also does video you were careful to correct me that last timeyou said you would never
manufacture so many of thesethings before and we'll see how it goes we don't knowif video is going to be a killer app but we'll see what happens what's your under plain statementtoday about downplaying the potential and opportunity for this device well to go back to our prior conversation we can now say that video workedit is a killer app we sold over 50 milliontv show episodes and in four months we've sold a 1.3million feature films
of itunes so it's definitely working as far as this goes you know this is the future and it's not you knowand i wish i wish we could sell it for 100 dollarstoday we can't it's a little more expensive than that but as we bring the cost down year-over-year and can appeal to more andmore people i don't see why everybody wouldn't want one of these last question for you again i mention we are financial
network and you know the question iscoming because you read the the press just as much as i do about youand your stature here at at apple computerthere is this ongoing stock options backdating controversy that you're dealing withwhat message do you have for shareholders and investors and consumersand employees that this particularcontroversy is what is going to happen in terms ofyour tenure at the company how's it going to affect your how youreassure people that this is not going to tank you
well you know it's a little frustrating sometimes whatthe press is writing - a lot of these folks just have no idea what they'retalking about it is frustrating to read itbut you know we did our own internal investigationand then we actually got a an independent investigator a formerfederal prosecutor who's extremely highly regarded and they look at jesus the betterpart of a million documents and they took several months and and they came out with their reportthat
said what it said and one other thingsit said was that no current management had any misconduct we did find somethings that i wish we hadn't found as ceo to some extent i'm responsible for but you know we've turn that allover to the sec and they'll take a look atsome those things we found but i don't think they're gonnaaffect current management and i think everything is going to be just fine steve jobs here to stay? i serve at the pleasure of the board and theshareholders and as long as they want me
i'd love to keep doing this job yeah i think they want you sothanks very much okay candid and comfortable steve jobs no question about itbasking in the glow of what promises to apple's next big red hot product butagain trying to make sure that that glow isn't eclipsed by this ongoing stockoptions backdating scandal maria back to you jim thanks very much we continue our discussion nowon steve jobs and apple computer joining me with [inaudible] inside isrichard stacy's hardware equity analyst
with standard & poor's lynn turner managing director of research at glass lewis gentlemen nice to have you with us welcome to the programgive me you quick reaction to the iphone and the impact on the stock in '07 sure well in terms of a thethe iphonerelease i think you look at it and the bar was set very very high for thisand even exceeded our expectations it it looks like truly like a revolutionary product it's now a touch screen format thebuttons are gone it's a very large screen
a lot of new technology andcapabilities related to it and in terms of what we're projectingonce it actually does come to market in june and in the subsequent twelve monthperiod we think you can add about 25 cents a share on a creative basis and that's assumingabout a 50 percent rate of cannibalisation with the stand-alone ipod device now if you are able to get to a little bit better than and doabout 15 million units we think with the additional leverage that they have youcan add maybe 70 to 75 cents to the bottom line so we think it'sdefinitely a home run product for apple
lynn do agree? yeah i don't thinkthe stock option scandal is going impact this at the end of the day earnings are going to be thereif jobs is able to put out a a better mousetrap when it comes to thecell phone heck all of us would pry like to have a better cell phone thanwhat we have today and he's able to accomplish that i think this company will continue to dovery well what about the issue that is present in the market today
which is the fact that prices keepcoming down this is basically a commodity right? the cell phoneeverybody's competing for the same customer how does that play into things? sure i'll jump on on that and i mean if you look at what they didrelated to the their max actually halfway '06 they actually sawasp's rise modestly so apple has a certain obviously a coolnessfactor a particular cachet they have a lot of people that will followand purchase the product just because it is an apple and they had good experiences in the past
be it with the ipod be it with the mac oranother particular product maybe the use of itunes so you're right it's a commodity relatedspace and certainly prices will erode over time but we think apple is going to be able to forestall that to some extent at least over the near-term real quick on the stock performancetoday an all-time high the shares certainly got a huge boostfrom this do the market get it right lynn? i think they'd they did i thinkthere's tremendous cachet for apple amongst the
the teens in the twenty to thirty yearolds in this country he's got tremendous pull he's gottremendous market recognition and if even puts out the bettermousetrap up people are gonna follow him alright will leave it there gentlemennice to have you with us thanks very much
thanks mariawe'll talk with you soon an upcoming clinical trial could make itcv therapeutics biotech boomerang a year we're live atthe jp morgan healthcare conference with the ceo next
