Analyst shares insight on Apple cell phoneAnalysts for American Technology Research on Tuesday said they \"firmly believe\" that Apple has been working on cell phone technology and that its \"much hyped\" imminent entry is \"overdone.\"
In a research note sent to clients on Monday, analyst Shaw Wu notes that for Apple to enter the cell phone market in the US, it would need approval from the FCC — a process that would need to take place at least three months prior to an actual product launch.
\"So far, Apple has applied and received WiFi and Bluetooth approval, but there is no sign of cell phone activity as of yet,\" he wrote.
The analyst believes Apple could protect potential product leaks about the phone by taking the \'announce now, ship later\' strategy. \"This could be similar to the Intel transition where actual product shipped seven months after the announcement,\" he wrote.
But Wu also believes the company is still in the planning stages of its market strategy for the device. Apple could participate in the traditional manner of teaming with carries likes Cingular and then supplying the hardware, he said. However, he told clients \"Apple is also exploring a vertically integrated model and user experience similar to its iPod + iTunes and Mac business models.\"
According to Wu, the most sensible solution for Apple would be to take the MVNO (mobile virtual network operator) route. \"Apple would have tighter control over the user experience including the hardware, marketing, service and support,\" he wrote.\"We believe its 147 or so physical retail stores in prime locations in the US and around the globe would come in handy in such an endeavor.\"
The analyst expects Apple\'s entry into the cell phone market to come no earlier than mid-2007 but \"more likely in 2008-2009.\" In the meantime, he anticipates Motorola continuing its trend of introducing new cell phones with iTunes capability.
American Technology Research maintains a Buy rating on Apple shares with a price target of $101.
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