Analyst: Here’s Apple’s ‘Next Big Thing’
In the company’s first fiscal quarter, iPhone sales hit a record: The 51 million phones sold during the period were the most Apple has ever sold in any quarter, surpassing the 47.8 million sold in the year-ago quarter. Those strong sales helped the company post strong earnings and profit numbers.
Yet even though Apple upset tradition and released two versions of its flagship smartphone — the iPhone 5S with Apple Touch ID and the low-cost iPhone 5C with a colored polycarbonate shell — sales numbers missed expectations. That fact suggested to investors that the iPhone has little room to keep growing. But analysts at JPMorgan Chase believe Apple has already planned where to expand next.
In a research note obtained by Apple Insider on Wednesday, the global tech research team at JPMorgan predicted that the iPhone maker’s “next big thing” will be a hybrid operating system that allows an iPhone or an iPad to dock into a specifically configured display and operate as a more traditional computer. Nicknamed “iAnywhere,” the converged operating system will reportedly merge characteristics of the Mac OS and mobile iOS, although the two platforms will be quite distinct, according to details given to the publication.
More specifically, the traditional Mac operating system will not be replaced but rather enhanced by the mobile platform; iOS functionality will increase while existing separately from the dedicated Mac OS. In basic terms, this converged platform will potentially be able to run Mac applications when connected to a larger display.
While this rough sketch of the converged operating system may not seem like the next category-defining product so desired by Apple investors, in the view of JPMorgan analysts,”iAnywhere could be a stepping stone to a broader peripherals and services-led sales, partially reducing Apple’s dependence on device-led product cycles,” JPMorgan’s Mark Moskowitz wrote in the note. “Apple could generate revenue through the sale of specifically configured displays, iAnywhere-capable iPhones or iPads, and cloud-based software and storage services.”
In addition, the platform could be an alternative to the company’s more expensive laptops.
The selling of peripherals, accessories, and services will offset any cannibalization risks to the Mac platform, said Moskowitz, per Apple Insider: ”We think it is important to point out that the iAnywhere revenue content per user could be similar or larger in size than a traditional Mac (computer) purchase given the mobility and peripherals revenue streams as well as the recurring nature of revenue related to the cloud-based services.”
The iAnywhere platform could be a key trend for the company as soon as this year, according to JPMorgan analyst Rod Hal, who wrote a separate note to clients. And by “important trend” the analyst means the device could reignite growth among Apple’s smartphones and tablets and increase market share, Apple Insider reports.
Of course, Apple executives have been asked whether the company will ever converge the iPad and MacBook Air into a single computing device, which would benefit from the portability of a tablet and the functionality of a keyboard and a desktop-scale operating system. But Apple has always responded “no.”
Still, patent filings show Apple has been experimenting with docking station designs, which could transform portable devices like smartphones and tablets into more traditional desktop computers. A 23-page filing made in February 2008 included more than a half a dozen potential docking interfaces, including one design configured like an easel. According to JPMorgan analysts, with the patents Apple already owns plus the company’s decision to switch to a desktop class 64-bit processor for the most recent versions of its portable devices, the iPhone maker is prepared to launch a more powerful computing experience on iOS.
According to the Apple Insider, JPMorgan’s research team believes the iAnywhere platform will be introduced in conjunction with the release of a new iPad with a larger display and dedicated keyboard.
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