Apple's stock drops as Microsoft's rise after 4S announcement

As the world waited for the iPhone 5, Apple today delivered a product that appears to have disappointed many.

With rumors flying around that the iPhone 5 would come with a new teardrop design, Apple fans were informed at the Apple press event in Cupertino that in fact there would be no iPhone 5 today (or perhaps even this year) and that they would instead release an upgraded version of the 4 – the iPhone 4S. The 4S is the same design as the 4 however “don’t be deceived, because inside it’s all new”.

With the announcement of the 4S, Apple stocks dropped as much as 3.5% whilst Microsoft stock rose 3.3% - if Microsoft ever had a chance in the smartphone market, now is the chance to take advantage. With Apple shareholders clearly not overly excited by the 4S, it leaves one to question how much Windows Phone and Android are set to benefit. With Microsoft having just released their new Mango update and with more new WP7.5 devices rumored for release later this month, it will definitely show a great deal about the consumers’ reaction to the relatively infant operating system.

HTC reported earlier this week that WP made up 30% of its sales and with many OEM’s only starting to get on board with Mango, if they get produce similar sales results to HTC, then Microsoft will have succeeded in making a thriving mobile platform.

Image credit: Reuters

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Also, despite the widest on-lauch availability for any iPhone to date in the US, it still lacks LTE or 4G support (while AT&T may not care, it's certainly an issue with Sprint and VZW) - Android suports both today (and Windows Phone 7.5 doubtless has models supporting LTE in the pipe for release this year). It's also still overpriced compared to the Android (in particular) competition.

I'm honestly pretty happy they didn't change the shape. A teardrop-shaped iPhone would look ugly as hell. The current design they have is much classier, and nobody's successfully imitated it yet.

I won a $500 bet that no iPhone 5 would be announced today. Nothing in leaked hardware indicated an iPhone 5 would be released soon. A few silicone cases are easy and cheap to make sense most of the retailers were asking for a guaranteed sale they had nothing to really lose from their end. The rumored iPhone 5 looked more like the updated iPod touch than anything else. It also didn't make sense for a new release now since LTE is still in its infancy. Apple can capture the entire market better when LTE is more mature and widely available from all three networks carriers. Kill all birds with one phone. Sprint needed the iPhone 4 and 4s. It hedged it's bets correctly. Getting rid of the premium upgrade option to keep unlimited talk, text and data is a much smarter move. Being a world phone is a big bonus and makes it a contender against the other two carriers. Maybe come April we will see the iPhone 5. Let the rumor mill start again.

mrmomoman said,
I won a $500 bet that no iPhone 5 would be announced today

Nice, you can take that money and get a real phone.

Enron said,

Nice, you can take that money and get a real phone.

please share what phones you consider a real phone? I have a few and would like to know of any of them are real phones.

virtorio said,
Tim Cook is really boring to listen to.

+1

Boy do I miss Jobs and how he made it a JOY to watch it...
That was the longest 90 minutes of Apple event EVER.

Really not digging his EXTREME love for statistics either, hell, that wasn't the share holder meeting!

Crap, get some lessons by Jobs, Cook!

GS:mac

Glassed Silver said,

+1

Boy do I miss Jobs and how he made it a JOY to watch it...
That was the longest 90 minutes of Apple event EVER.

Really not digging his EXTREME love for statistics either, hell, that wasn't the share holder meeting!

Crap, get some lessons by Jobs, Cook!

GS:mac


Wasn't the problem that it was basically just a big rehash though? I don't think Jobs giving the same presentation would have been a whole lot better...

"The 4S is the same design as the 4 however “don't be deceived, because inside it's all new”."

The main problems I heard about the iPhone 4 were all on the outside. So if they haven't changed that, do they still remain? I'm talking about the antenna issue and the glass shattering when dropped.

protocol7 said,
"The 4S is the same design as the 4 however “don't be deceived, because inside it's all new”."

The main problems I heard about the iPhone 4 were all on the outside. So if they haven't changed that, do they still remain? I'm talking about the antenna issue and the glass shattering when dropped.

Antennagate is supposed to have been fixed in a quite smart way. (Which is non-existent for me either way, as I live in Germany where cell network infrastructure is strong as crap)

Glass gate: use a proper case, done.
I don't get why people carry multi-hundred dollar devices sans protection either way, be it an iP4, a Galaxy SII, a WP7 phone, a camera, ...

Seriously guys, you can have everything fall and break, sure the iPhone 4 does have extra vulnerability, but it doesn't affect me so far as I use a good case. (It's not even a special one, just simple plastic covering the side and back)

Also pay attention to give such devices some extra tender loving care and attention.

Doesn't mean, the problem isn't there, it just is a matter of how you tackle and may still live on with it and enjoy advantages of the product in turn.

To each his own device, people who run Android or WP7 and are lucky, all the power to them!

And yes, this was a let down, NOTHING unexpected, however I liked the personal assistant a lot.
Hopefully jailbreaking will bring it to the iPhone 4 (NO-S)
I don't see the need for the A5 here, seriously.

GS:mac

This is definitely a good opportunity for Microsoft, and Nokia as well. With the iPhone 4S having the same terrible antenna design, it really makes sense to push Nokia's stellar performance.

migo said,
This is definitely a good opportunity for Microsoft, and Nokia as well. With the iPhone 4S having the same terrible antenna design, it really makes sense to push Nokia's stellar performance.

Get your facts straight and come back.

GS:mac

Glassed Silver said,

Get your facts straight and come back.

GS:mac

Not sure why you add that dumb signature at the end of all your posts. I can see your name at the top of your comment and nobody cares what OS you're using.

SpyderCanopus said,
What exactly is different about it? I don't see many iphone4 users upgrading to it.

Most people will notice the new virtual Assistant, better camera and faster gaming(due 7x faster A5 GPU).

KingCrimson said,

Most people will notice the new virtual Assistant, better camera and faster gaming(due 7x faster A5 GPU).

I love how everyone is throwing around this 7x faster figure just because Apple said it. At least let a reputable tech web site verify those claims before you run around acting like it's gospel.

Just as I suspected. Nothing new just a rehash of old tech. Not worth the $200 they want for the 16GB model. I'll stick with my LG Thrill or better yet grab the Galaxy S II as they are both far more flexible.

rafter109 said,
Just as I suspected. Nothing new just a rehash of old tech. Not worth the $200 they want for the 16GB model. I'll stick with my LG Thrill or better yet grab the Galaxy S II as they are both far more flexible.

* better camera then the competition now(8MP sensor and faster shutter times)
* Siri
* A5 = best mobile processor on the market

KingCrimson said,

* better camera then the competition now(8MP sensor and faster shutter times)
* Siri
* A5 = best mobile processor on the market


And if the iPhone 4 camera is anything to go by the quality of this one will blow most other mobile phone cameras out of the water even the ones with higher MP.

KingCrimson said,

* better camera then the competition now(8MP sensor and faster shutter times)
* Siri
* A5 = best mobile processor on the market


AHAHAHAHAHAHA

OMFG!!!!!! New iPhone! It's still the same old sh__, but it's a little faster! Are you going to wait in line for one? Hey, maybe we can camp out together! I'll bring a Thermos of instant capuccino!

Skwerl said,
OMFG!!!!!! New iPhone! It's still the same old sh__, but it's a little faster! Are you going to wait in line for one? Hey, maybe we can camp out together! I'll bring a Thermos of instant capuccino!

LOL.. but it took 16 months to figure out how to fit an A5 in the iphone 4!!

I still dont know why people think that the A5 is a dual core at 1Ghz.. its underclocked to increase battery life.. the ipad 2 has an A5 at 900Mhz.. I am so sick of all the tech blogs assuming it is 1Ghz.. you are playing right into their hands so they dont have to say what it performs at and you guys just assume its similar to the competition so they dont look as bad

I'm sure when these phones sell out continuinly running up to and through christmas it will restore any dips in stock!

REM2000 said,
I'm sure when these phones sell out continuinly running up to and through christmas it will restore any dips in stock!
I don't know... it doesn't appear worth it to break a contract and if your contract is up why not wait for a larger upgrade? If I am spending $200 or more on a mobile and locking in to a 2 year deal, I want to make damn sure that I get the biggest bang for my buck and the 4S does not appear to be that bang.

zeke009 said,
I don't know... it doesn't appear worth it to break a contract and if your contract is up why not wait for a larger upgrade? If I am spending $200 or more on a mobile and locking in to a 2 year deal, I want to make damn sure that I get the biggest bang for my buck and the 4S does not appear to be that bang.

Agreed. Assuming I was an iPhone 4 owner, why would I shell out $200 or more AND lock myself in for another 2 years, just to get a phone that looks identical to my current one, is only marginally faster (the iPhone 4 wasn't slow), has slightly sharper camera pictures, and has only minor feature additions/improvements? Especially with a large number of those new features coming to my existing phone with the iOS upgrade anyway.

The 4S is fail if you ask me.

TCLN Ryster said,

Agreed. Assuming I was an iPhone 4 owner, why would I shell out $200 or more AND lock myself in for another 2 years, just to get a phone that looks identical to my current one, is only marginally faster (the iPhone 4 wasn't slow), has slightly sharper camera pictures, and has only minor feature additions/improvements? Especially with a large number of those new features coming to my existing phone with the iOS upgrade anyway.

The 4S is fail if you ask me.


2x CPU and 7x Graphics performance is marginally faster?

itsthenewDC said,

2x CPU and 7x Graphics performance is marginally faster?

It's a phone.

OMG SOLITAIRE IS 7X BETTER!

Seriously...nothing particular impressive about this phone. It's pretty 2010...and last time I checked it was 2011. Apple won't want to get caught behind the curve for long so they'd be wise to hurry up with the new iPhone and it better be good.

(speaking as an unbiased viewer who has had the same Sony Ericsson phone for over 5 years)

technikal said,

It's a phone.

OMG SOLITAIRE IS 7X BETTER!

Seriously...nothing particular impressive about this phone. It's pretty 2010...and last time I checked it was 2011. Apple won't want to get caught behind the curve for long so they'd be wise to hurry up with the new iPhone and it better be good.

(speaking as an unbiased viewer who has had the same Sony Ericsson phone for over 5 years)


Wait...
First you say that the hardware updates are irrelevant since it's just a phone anyway...
Then you say it looks like a 2010 device even though the hardware is now pretty much at the top (even thought quad cores will be coming out soon, but as you said it's a phone right) with a design that looks far more modern than many of the plastic boxes it's competing with...

Apple better hurry up with a new phone? They just release one to match current specs out their, to be on top again...

Does it really need a new shape every time it's updated? Is that the most important thing?

Now I won't be updating, I'm perfectly fine with my iPhone 4 and I'm far more interested in seeing a new iPad since I skipped the iPad 2, but this is still a pretty big update and should be welcomed by anyone wishing to update from a 3G or 3Gs.

Leonick said,

Wait...
First you say that the hardware updates are irrelevant since it's just a phone anyway...
Then you say it looks like a 2010 device even though the hardware is now pretty much at the top (even thought quad cores will be coming out soon, but as you said it's a phone right) with a design that looks far more modern than many of the plastic boxes it's competing with...

Apple better hurry up with a new phone? They just release one to match current specs out their, to be on top again...

Does it really need a new shape every time it's updated? Is that the most important thing?

Now I won't be updating, I'm perfectly fine with my iPhone 4 and I'm far more interested in seeing a new iPad since I skipped the iPad 2, but this is still a pretty big update and should be welcomed by anyone wishing to update from a 3G or 3Gs.

Hardware is very important but blowing your load over better graphics like the other guy? On a phone? A phone that already had more than sufficient performance? Its like buying the 2nd best nvidia card on the market when all you play in Counter-Strike...and then deciding you need to buy the best card on the market for another few hundred quid to play it exactly the same.

Considering the Galaxy S II seems to be the phone that is compared most to the iPhone 4 and is cheaper in the UK I must be missing the point. Same 18 month contract, same allowances. iPhone? Pay £203. Go for the Galaxy S II? £105. Save yourself £100 instantly. Who knows what the new premium will be for the iPhone 4S...

Oh wait now I remember...you pay more because it has an apple logo on the back

Leonick said,

Does it really need a new shape every time it's updated? Is that the most important thing?

thats one of the main things apple consumers look for.. a cool look and a sexy product.. dont compare to the iphone 3Gs because that was when their was not much competition for good looking full feature phones.. now people have tons of options.. WP7 which is way sexier and when highschool students start seeing their teachers/grandparents with iphones they become less cool.. its how it always happens..

iphone 5 is obviously coming right before the 2 year mark of the iphone 4 release so that everyone that got one of those will stay with them.. they are on the defence more then they used to be..

this isn't new...apple stock has dropped on every media/keynote event barring one back in 2005 when they moved to the intel platform and steve announced bootcamp.

not to mention the overall market took a tumble as well before shooting up in the last half hour. if anything, today was a great buying opportunity (unless of course we go into a recession in which case, there will be better opportunities in the future).

Arpit said,
this isn't new...apple stock has dropped on every media/keynote event barring one back in 2005 when they moved to the intel platform and steve announced bootcamp.

not to mention the overall market took a tumble as well before shooting up in the last half hour. if anything, today was a great buying opportunity (unless of course we go into a recession in which case, there will be better opportunities in the future).

True, but here is the overlooked aspect.

Apple hides details of their announcements, the media and people assume the 'missing' details are 'good things'. (In contrast to the Zune thing from Microsoft yesterday, were 'missing' details were assumed to be bad, which is how all missing details are treated about Microsoft products and announcements.)

So when the announcements come from Apple, they initially disappoint people for a short period of time, and Stock drop and a few articles about Apple blowing it appear.

However a couple of week after the announcement, the disappointment is gone, and people love the product more than ever, and write articles on why Apple was smart to leave out important features, etc.

Even the original iPhone, it had a lot of disappointment with Bluetooth, voicedialing, etc - things free cheap phones at Walmart had, and should have been standard on a smartphone. (Windows Mobile at the time had all these features.) Then after the initial announcement and disappointment, things appeared why Apple was smart and saving battery life and voice dialing wasn't needed on a touch screen device, etc etc..

So they recover, as the missing features and disappointments became good things and 'reasons' to own the product, instead of the *gasp* they should have remained.

Almost every announcement made by Apple that has disappointment and technically 'bad' and missing features are vigorously defended by Apple fans and the media (as most of the technical and non-technical media are given free Apple products, which does create bias.).

You can still find people defending why the original iPhone's disappointments were 'features' and 'brilliant', yet in the real world, they were jaw dropping disappointments.

OS X is another good example, with the first version, and how they patched the XNU/Darwin kernel to improve single CPU multi-threading, and this was a 'feature', yet it destroyed multi-processor performance, that OS X still lives with to this day, and even with the modified Snow Leopard APIs to help bypass the funnel locking queues, OS X can have 8 CPUs/Cores and be running on one or two the majority of the time because of how the queue resolves.

OS X's implementation of OS 9 compatibility was horrid, yet soon became something people reference as a 'great' feature of OS X. On Windows NT, prior version compatibility was seamless as Microsoft moved consumers from Win9X to XP, and people even called this a bad thing, as it wasn't as 'brilliant' as OS X being able to run OS 9 as a VM. (Which is beyond insane.)

Or the year OS X was shipping on 64bit CPUs, yet the missing details was OS X was still only a 32bit OS with no 64bit support whatsoever. This was seen as 'good' as Apple Fans and the media were telling the world that a 32bit OS was faster, and that 64bits didn't matter as it was 'only' address space, etc. (Again insane.)


And in the contrast...
Microsoft's announcements tend to 'surprise' people in being better than expected. Especially with the pre-announcement missing details almost always assumed to be detriments and bad.

And almost with in a few hours, all the 'extra' good things in Microsoft product announcements are picked apart and demonized and conflated to be copying Apple and not as good as Apple's competing product. (Which makes engineers and scientists twitch, as they are often not even the same concept or feature, and ones that are similar had come from Microsoft R&D that didn't make the mainstream or tech press that had existed years before Apple implemented it.


(There are tons of the Apple examples, of why a single button mouse is better, all the way back to the 80s and why Grayscale was better than Color because Apple said so. Even font hinting and smoothing was 'bad' for years, until Apple finally added it. And on and on and on..)

If you are so much better than the media you always complain about why don't you apply for a job ?

Then we could have a media biased toward MS instead of google and apple ...