The 20th August was a momentous day for Apple Inc. as they saw their market value exceed $623 billion equivalent to around £397 billion, a value that has beaten that previously set by Microsoft Corp back in 1999 which saw the value of technology stocks and shares soar. Apple is listed on New York’s Nasdaq stock exchange, where shares rose by 2.6% to above $600 per share amidst mounting speculation about the rollout of the much awaited iPhone 5. The launch date of Apple’s latest smartphone has yet to be announced, but industry commentators are speculating a release on September 12.
To put this market value in context, it is worth mentioning that its nearest rival is the oil company, Exxon Mobil who is worth $200bn less at just $405bn.
On December 30th 1999, the market value of Microsoft was $620.58 billion, which means that if inflation was to be taken into account, it would still hold the record for being the world’s most valuable company. But times change and today you would have to combine Microsoft’s current value of around $257 billion with that of Google in order to get anywhere near the value of Apple today. This widely reported fact about Microsoft has been disputed by Techcrunch, who claims that if you go back to 1967 and add inflation to the market value of IBM at the time, it would in fact be worth $1.3 trillion today.
Rumours surrounding the specification and design of the iPhone 5 have been rife and it has been acknowledged that it is the last design that will have had an input from Steve Jobbs and is therefore thought to be his legacy to the IT world. Many expect the phone to have an increased screen size in line with the trend for larger screens as the phones are used for web browsing and watching video to a greater degree than making calls. The phone is likely to retain its ARM licensed, quad core processor but is also likely to have 4G capabilities; great news given that Everything Everywhere has just been allowed access to the 1800MHz frequency by Ofcom, opening up access to 4G in the UK for the first time in as little as a couple of month time.
Others have also been speculating the release of a new, smaller and potentially cheaper iPad to compete with the growth in the 7-inch tablet market to ensure that it can retain its current market share in the wake of new Android smartphones and tablets.
Apple has become synonymous with innovative functionality and beautifully styled computers and gadgets which have resulted in the phenomenal sales of both the iPhone, which was first launched back in 1999 and the iPad. Just eight years ago the company was worth $10billion which over the next five years rose to $100 billion.
Apple’s success to date is even greater when you consider that goods made in the United States and sold in Europe are very expensive, partially resulting from the strength of the US dollar against the Euro. So taking this into consideration, it will be interesting to see whether that, in combination with recessions that are being experienced in the majority of European markets will slow their growth as consumers are slower to adopt the latest technology.
Another consideration is the impact of its competition which seems to be gaining strength as new phones including Samsung’s Galaxy S3 and HTC’s One X offer consumer’s similarly great design and functionality at a cheaper price and with the flexibility that you get from not being restricted to the sole use of iTunes.
It is widely expected that Apple shares could reach $900 per share and that it will be the first company to reach a market value in excess of $1 trillion. To be able to achieve that, Apple will have to maintain and grow its innovation something that many industry commentators doubt may be possible since the death of Steve Jobbs, who was widely reported as the driving force behind the Apple vision for innovation. This need for innovation has been commented upon by the Vice President of Gartner Research, Van Baker who said:
“All the products made under Tim Cook’s tenure have been tweaks to existing products. One of the companies’ big successes, the iPod line, is in decline and they are going to have to replace that.”
It looks like the future of Apple is by no means certain, so it’ll be an interesting one to watch unfold over the coming months and years, but if you fancy owning the latest iPhone 5 once it’s released, an easy way to trade up would be through a mobile trade in deal or you could sell your mobile online and put that cash towards your new piece of Apple Technology.