Rocket Bomber - article - business - Geek Biz Report: week ending 25 April 2010

Geek Biz Report: week ending 25 April 2010

filed under , 24 April 2010, 02:10 by

Both Amazon and Apple reported quarterly earnings this past week. Could someone remind them there’s a recession on?


CUPERTINO, California—April 20, 2010—Apple® today announced financial results for its fiscal 2010 second quarter ended March 27, 2010. The Company posted revenue of $13.50 billion and net quarterly profit of $3.07 billion, or $3.33 per diluted share. These results compare to revenue of $9.08 billion and net quarterly profit of $1.62 billion, or $1.79 per diluted share, in the year-ago quarter. Gross margin was 41.7 percent, up from 39.9 percent in the year-ago quarter. International sales accounted for 58 percent of the quarter’s revenue.

Apple sold 2.94 million Macintosh® computers during the quarter, representing a 33 percent unit increase over the year-ago quarter. The Company sold 8.75 million iPhones in the quarter, representing 131 percent unit growth over the year-ago quarter. Apple sold 10.89 million iPods during the quarter, representing a one percent unit decline from the year-ago quarter.

And that doesn’t even include the new iPad, which launched just a couple weeks ago.


SEATTLE, Apr 22, 2010 (BUSINESS WIRE) —, Inc. (NASDAQ:AMZN) today announced financial results for its first quarter ended March 31, 2010.

Operating cash flow was $2.78 billion for the trailing twelve months, compared with $1.76 billion for the trailing twelve months ended March 31, 2009. Free cash flow increased 62% to $2.32 billion for the trailing twelve months, compared with $1.43 billion for the trailing twelve months ended March 31, 2009.

Net sales increased 46% to $7.13 billion in the first quarter, compared with $4.89 billion in first quarter 2009. Excluding the $185 million favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales would have grown 42% compared with first quarter 2009.

Worldwide Media sales grew 26% to $3.43 billion. Excluding the favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 22%. Worldwide Electronics & Other General Merchandise sales grew 72% to $3.51 billion. Excluding the favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, sales grew 68%.

The U.S. Kindle Store now has more than 500,000 books, including 100 of 111 New York Times Bestsellers, more than 9,000 blogs, and more than 175 top U.S. and International newspapers and magazines, including: The New York Times, Le Monde, USA Today, The Times (U.K.), The Economist, Fortune, Newsweek, and Time.

Independent estimates (some of it based on availability of parts) put the Kindle ecosystem at 7 Million units. Compare to 24 Million Xboxes, 42 Million iPhones, 140 Million Nintendo DS systems, or 1 Billion PCs.

[Honestly, business folks, y’all are supposed to be smart: the iPad is nifty and all but there are One Billion Screens out there already — why do we have to wait for an Amazon proprietary e-book or Apple app to get legitimate digital comics? One tenth of one percent of a billion is a million freakin’ customers. Is .001 too high of a target to aim for?]

My other take on it is: Amazon has a 7 Million unit head start in the coming device war, but Apple will sell 7 Million units by Christmas. I’m not sure which horse to back in this race. Apple just wants to become the new ‘cable company’, siphoning money off the top while providing content produced by others, while Amazon—not content with merely killing off bookstores—would also like to kill off traditional publishing.

[Geek Biz Editorial]

And the long aside:
One might think there is value in the death of ‘publishing’, as the author gets a bigger chunk of the profits and the time to get a ‘book’ to the reader is compressed as vast chunks of the process are either unnecessary or skipped anyway: I write a book, I sign with Amazon, they format it for Kindle and it goes on sale next week. Neat, right?

Well… only if you ignore the role of editor in the production of books. Without an editor — and fact-checker, and proof-reader, and publicist — there is no book: Unedited writing is already out there, in vast quantities and most of it free: you’re reading some of it right now.

The Book As Object, Artefact, and Work is not the sole output of the writer alone, it is the end product of a process, a collaboration between writer, editor, publisher (the fine people for whom ‘Publisher’ is a job title, not the companies) and quite a few others on staff who contribute smaller chunks, from the folks who write jacket copy, & compile indices, to those who design covers and introduce each season’s new slate of releases to booksellers (Occasionally in person: here’s a shout out to Toni, my RH field rep, who does excellent work that benefits both RH and those of us in stores). Much of the usefulness of a ‘book’ comes from these add-ons, and much of our enjoyment of a work is the result of this polish and finess that is added after the manuscript is submitted.

And while some large media conglomerates also seem to be slowly abandoning the traditional (and highly effective) editorial process in favour of… well, I’m not really sure what they’re in favour of, other than money — their lax habits and slacking-off should not be taken as an opening for a greedy internet retailer to implement an even worse new system.

Dear Amazon: There is already a platform for authors to publish direct to readers, without an editor, or proper marketing, or the input of a team of professionals whose profession and calling is the production of books

It’s called the internet. And if e-books, in their intrinsic quality and worth, are little more than the collected archives of a blog, why in the hell would I pay you $10 for it? There are some geniuses out there, obviously. And the publishing industry is far from perfect — but the process works and every bestseller on both your website and your precious e-reader is the result of that process, and all your filthy profits on e-books are just parasitic bloodsucking on the art and craft of real book production, contributing nothing in and of itself, and until you recognise that salient fact, you are doomed to fail.

Oh, you might be able to kill off dead-tree-books, but you won’t be able to replace them with your current business model. You may sell billions of them, and think you know the business, but Amazon, you have much to learn about what a book is.

Speaking of e-readers:
Via Shelf Awareness – a review of the TV marketing for the top 4 contending devices: Nook, Kindle, Sony and Apple: go take a look

Also of note:

  • Kindle to sell at Target; B&N’s Nook to sell at Best Buy. [multiple links; visit a store or Google it if you’d like details]
  • Manga anthology Yen Plus goes digital
  • SCOTUS reaffirms First Amendment Rights — yes, even for stuff that lacks taste, merit, or “serious religious, political, scientific, educational, journalistic, historical or artistic value.” You know: crap; some of it really offensive crap. Now, we’re waiting to see the case where this ruling encounters the Miller Test. Folks, your right to say anything, buy anything, or even see anything means putting up with the icky. And you don’t have to look if you don’t want to. Just, a little forbearance and forgiveness, and the return of some damn privacy for what is done behind closed doors and we can all get along in peace.
  • Any advances made on one front are almost immediately countered: Pirate Manga Apps for your iPhone. Dudes: not cool. If you want to steal, take up mugging. At least mugging is more ‘honest’ than this crap, in that you have to physically interact with your victim, not just charge money to look at stolen stuff second-hand. Oh, and Apple needs to clean up this crap, right quick; we put up with your walled garden and draconian rule because it’s supposed to prevent this kind of raw, unapoligetic grift. Way to drop the ball, Apple.


Aggregate prices on the Rocket Bomber Geek Stock Index rose 41.42 points this past week (up 4.09%) bouyed by larger gains at Netflix and Apple, and general gains across all stocks tracked. It’s interesting to note, however, that AMZN dropped 6.46 points after posting their Q1 numbers on Thursday (I guess as good as they were, some investors were betting on more) — despite that AMZN was still up $1.46 week-to-week.

Rolling 10-week RBGSX Aggregate Price

Value at close of markets Friday 23 April 2010: $1054.56

& the 25 stocks: CBS Corporation (NYSE:CBS), The Walt Disney Company (NYSE:DIS), News Corporation (NASDAQ:NWSA), Sony Corporation (NYSE:SNE), Time Warner Inc. (NYSE:TWX), Viacom, Inc. (NYSE:VIA), Wiley John & Sons Inc. (NYSE:JW.A), The McGraw-Hill Companies, Inc. (NYSE:MHP), Lagardere SCA (EPA:MMB), Pearson PLC (NYSE:PSO), Scholastic Corporation (NASDAQ:SCHL),, Inc. (NASDAQ:AMZN), Books-A-Million, Inc. (NASDAQ:BAMM), Borders Group, Inc. (NYSE:BGP), Barnes & Noble, Inc. (NYSE:BKS), Hastings Entertainment, Inc (NASDAQ:HAST), Indigo Books & Music Inc. (TSE:IDG), Best Buy Co., Inc. (NYSE:BBY), Netflix, Inc. (NASDAQ:NFLX), Navarre Corporation (NASDAQ:NAVR), Activision Blizzard, Inc. (NASDAQ:ATVI), Electronic Arts Inc. (NASDAQ:ERTS), GameStop Corp. (NYSE:GME), Nintendo Co., Ltd (OTC:NTDOY), and Apple Inc. (NASDAQ:AAPL)

Please note: nothing here is investment advice. full disclaimer


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