I just don't get it on these stock valuations

Just for the sport of it, with the Agilent announcement, I ran a comparison of Market Caps vs Revenue for seven companies, looking to see how Agilent had done vs. HP over the past fifteen years.  The numbers were a bit interesting (you can see the post on my INTRAPRENEURING INNOVATION blog)

Essentially Agilent, with $6.8 Billion in sales, is valued at $17B, the same as Dell with $62B in sales (which by the way is their highest in history).

Danaher, Agilent's closest competitor, has $17B in sales, is valued at $48B, 20% more than HP with $120B in sales.

But the thing that struck me, and I wasn't looking for this, is TAKE A LOOK AT THE PC WORLD in terms of INTEL, MICROSOFT, DELL and HP.   All four are highly leveraged on PCs.  The stock market must not think that matters for Intel or Microsoft.  Check out the slides below and tell me why their stock prices are so lofty...

Agilent news

Interesting--the Silicon Valley Biz Journal minimized the Agilent split last Thursday, so much so that I initially missed it.  As did many old HPites, from what I've heard over the weekend

Lessee, now -- The old Instrument Company, the "real HP", was about $8B when it was divested by Lew Platt in 1999.  It got to almost $11B in the run-up of the dot.com magic, and then fell to about $4.8B, like overnight.   At that point, Microwave was still the kingpin, but there were a lot of other businesses, like Components which included something like 80% of the LEDs of the world, and Medical and Analytic Chemistry, and Automatic Board Testers, Atomic Clocks, and even Logic Analyzers.

Today, much of that has been divested -- Components and Medical sold to Philips mostly, Atomic Clocks and Board Test sold off or spun into new companies.

Agilent, as a derivative of its old Microwave line, is doing cell phone testing--something like 98% of all cellphones ever sold were tested on Agilent equipment, if my sources are right.  And their 'scope business is actually doing pretty well, merged with Logic Analyzers--Tektronix lost the recipe some time ago, and got sold to Danaher--WHO?

Danaher is sort of everything Agilent 'could be'-- they are as diversified as Siemens or GE.  Their website proudly says, "$16B science and technology leader in Test and Measurement, Environmental, Dental (yup!), Life Sciences and Diagnositics, and Industrial Technologies."  Their T&M lines include acquisitions Tek, Fluke (Bill Parzybok sold Fluke to them), and Arbor (a version of Al Steiner's old Colorado Telecoms); these are a bit distant from dental.  And Danaher valuation is $48B, 20% higher than all of HP on sales that are one-eighth as much.  Whew....

Anyway, now Agilent is subdividing again--into a Life Sciences pure play, about $4B in size, spinning off the old T&M business, about $3B in size.  The rationale?  That the stock market will value them more higher if they're understandable for what they're trying to do.

By the way, the market already values them at $17B, on $6.6B in revenue.  They'd like to go HIGHER

HP, today, at $21.03 per share, is valued at $40.44B, with sales of $120B.  Can you imagine your HP stock price jumping to $150/share?  That's the equivalent value that Agilent owners have today.

Is that what they mean by 'unlocking value'?

HP and innovation in smart phones?

We've been commenting about Meg's publicly stated desire to be in the smart phone business in earlier posts (we've avoided joining the chorus about smart wristwatches, altho the Cricket, HP-01, fetches more $$$ now than ever before)....

Here's the litany of early analyst reviews about Apple's new iPhone 5s and 5c, which we wrote briefly about last week.  Emphasis mine in blue; ediotiral comment in red.  

Since HP entered most markets "late" -- think Audio Oscillators, Voltmeters (both analog and digital), Sweepers, Medical and Analytical Chemistry lines, Printers, PCs, and Minicomputers to name a few -- and prevailed almost always (after three tries or more) -- why not smart phones?

The question is "is there still innovation room in this space?"  

This compilation appeared this morning in the Washington Post, hopefully more accurate than their unfortunate comment yesterday that Thomas Hoshku was HP's CEO (sorry, Meg):

By Hayley Tsukayama, Updated: Wednesday, September 18, 7:19 AM 

The first full reviews of Apple’s new phones are up, ahead of their retail availability on Friday. Here’s a look at what reviewers are saying about the new phones and Apple’s new mobile operating system, iOS 7, which is due to release sometime Wednesday. Here are bottom line takes from the reviews out there Wednesday morning:

Walt Mossberg, WSJ: Mossberg has only put up a review for the iPhone 5s, Apple’s higher-end model, which comes with a fingerprint scanner and improved camera sensor. He says, overall, that the phone is a “delight” and that its software and hardware make it the “best smartphone on the market.”  Mossberg usually gets more 'in-depth' than this superficial comment, especially re 'futures'

David Pogue, NYT: In his review, Pogue gives a somewhat negative take on the phones, not necessarily because of quibbles with quality, but with what the models mean for Apple. He actually reviews the phone fairly favorably, calling the 5c a “terrific phone,” but notes that just “sheathing last year’s phone in shiny plastic isn’t a stunning advance.” His highest praise is for the software on the phones, which he said has been redesigned for ease and functionality. Even Siri, he said, can do way more with this OS than she could before.  This is a puzzling take, damning with faint praise mostly?

Rich Jaroslovsky, Bloomberg: In his review, Jaroslovsky gives the phones high marks, but makes it clear that he’s not that impressed with the latest generation of phones from Apple.   “There’s nothing wrong with either phone. But there’s not much that’s pulse-quickening about them either,” Jaroslovsky concludes.  Classic Bloomberg analysis -- straight down the pipe, ZERO imagination

Anand Lal Shimpi, AnandTech:AnandTech is one of the best technically focused review sites out there, and Shimpi has turned out two monster reviews there. His much-more extensive iPhone 5s review is definitely worth a read. In the final analysis, he says that he is “seriously impressed” by the A7 chip in the iPhone 5s, which he says is “capable of competing with the best Intel has to offer in this market.”   He also has high praise for the Touch ID fingerprint reader, saying he was initially skeptical about how well it would work. But the phone has won him over: “I originally expected Touch ID to be very gimmicky, but now I’m thinking this actually may be a feature we see used far more frequently on other platforms as well,” he said.  As we snored last week, this is BIG

John Gruber, Daring Fireball: Over at Daring Fireball, John Gruber has a lot of great thoughts about what the iPhone models mean for Apple’s future and its ability to innovate, which are well worth a read. Gruber speaks well of the iPhone 5c and how it feels, saying that the plastic feels good in hand — and much slimmer than Apple’s last plastic phones, the 3G and 3GS — and that the buttons feel good with “nice crisp clickiness.” He goes into detail about how much faster the iPhone 5s is than others on the market, and says that he not only likes the fingerprint scanner but also sees tons of potential in what it could do in the future.  Duh, you bet!

Jim Dalrymple, The Loop: Jim Dalrymple focused his reviews on function rather than form by focusing on everyday use. He explains: “I’m all for new features, but if they don’t actually help me get things done more efficiently, then you have to ask, ‘what’s the point?’”  Jim totally misses the point!

just another piece of bad news?

Josh Feldman, writing for Mediaite, forwarded to a vast 'web audience' the Rachel Weiner story carried by the Washington Post today (THE newspaper for our nation's capital):

WaPo‘s Rachel Weiner reported on comments from HP CEO Thomas Hoshko about how Alexis had the security clearance to be in the Navy Yard.

Alexis had a security clearance that was updated in July, approved by military security service personnel.

“There had to be a thorough investigation,” Hoshko said. “There is nothing that came up in all the searches. “

Alexis had finished a contract the company in Japan as part of the work and was about to be reassigned to do additional contract work at the Navy Yard.

Betcha didn't know that Meg has given up her job, and Hoshko got it.

The true story of course is that Hoshko is CEO of "The Experts" which is the sub-contracting firm that employed and presumably did background checks on killer Aaron Alexis.  Of course, Hoshko said, "no, we just do drug abuse checks.  The military should do the background checks, and they are the ones who defaulted."  Wow!  The fox is watching the henhouse.

MarketWatch (THE stock market service) carried a headline last night in San Francisco saying: "Navy Yard Shooting Suspect was HP subcontractor"   PR nightmare, right?

In fact, he was a 'lowly employee' of an HP subcontractor, which is somewhat more removed than the headline might suggest.  HP presumably didn't do background checks of "The Experts" but left that up to the military as well?

MarketWatch went on to quote HP: “We are deeply saddened by today’s tragic events at the Washington Navy Yard. Our thoughts and sympathies are with all those who have been affected,” said Michael Thacker, an H-P HPQ -0.09%  spokesman, in a statement.

“Aaron Alexis was an employee of a company called The Experts, a subcontractor to an H-P Enterprise Services contract to refresh equipment used on the Navy Marine Corps Intranet (NMCI) network. H-P is cooperating fully with law enforcement as requested,” said Thacker.

The first releases, Reuters, Dow Jones, WSJ, all reported these words with the note that  "an HP spokesperson who wishes to remain anonymous" said them.  So much for staying anonymous.

And sad that HP's name came up at all in this tragedy.

Ouch! Apple bruising continues

Remember the guy who blew the cover on the HP TouchPad, going to Best Buy expecting "lines of customers" only to find that the store personnel didn't know whether they even carried the device?  For some fascinating arcana, go read my post of 7/5/11 "Ouch,.and then some"

Well, 'front lines' sometimes tell the story.  If they do in the case reported yesterday in the Silicon Valley Business Journal as follows, "Houston, we have a problem" at Apple.  Maybe the pundits, and not the Wired observer, have it right?

Sep 11, 2013, 11:56am PDT

Apple's new iPhone doesn't impress in Beijing

Vincent Lara-Cinisomo, Web contributor

Apple's iPhone 5C and 5S were unveiled to much fanfare in the States. But what about in China, where the Cupertino company is hoping to make inroads? Eh.

Bloomberg reporter Christina Larson made the rounds in Beijing, asking a cross-section of folks what they thought of the new phones.

Larson said the 5C is mocked as "not attractive;" Zhang Ao, a cameraman for Beijing Television and iPhone 4S owner, told Larson that the bright-colored 5C looked "like a cartoon," said the Apple "wow factor" had long worn off.

A colleague of Zhang, Angel Kang, said Apple releasing the phones in the U.S. and China around the same time was a "nice friendship gesture," but doesn't plan to buy one.

It's hardly a scientific study, Larson admits. But at a time when Apple greatly desires to penetrate the market, China's lukewarm reaction to the new devices, plus the higher-than-expected price, could put a crimp into the plans.

Fickle stock market slams Apple

Guess the stockbrokers and analysts forgot to read the Wired article, or for that matter, the smart analysts at Forrester.  The stock plunged 6% today, on "disappointing" announcement of new iPhones.

I posted earlier re the Wired "4 POINTS", covered by Kyle Vanhemert;  PERSONALIZE, HARMONIZE (SW and HW), A TRUE DIGITAL SELF, and BODY and CONTEXT AWARE

I didn't discuss the 64-bit architecture, which Tony Cripps, senior device analyst at Ovum, described as:
"Meaningful innovation..., genuinely claim to have brought something new to the smartphone party.  ...should cement its lead as a mobile gaming platform (over Android)... in a space whose significance is sometimes downplayed beyond the gaming world."

And I didn't add the superlatives that Forrester analyst Frank Gillett did about the fingerprinting security: "Jaw droopingly easy" and "the first painless Biometric I've seen"

Longtime commentator Tim Bajarin was equally ecstatic.

Not so Dan Nakaso at the San Jose Mercury-News.  He managed to run a 5-column story with Troy Wolverton that led with "facts" -- pricing, availability, confirmation of rumor, etc, plus Bajarin's positive comments before launching into the "unclear how the pubic will react" paragraphs.  These featured Bob O'Donnell at IDC, saying "no surprises, ...disappointed" and Art Greengart at Current Analysis, saying "It's an iPhone 5 made out of plastic."

Then the paragraph that damns without much faint praise for which HP watchers have become all too accustomed: "APPLE's announcements came as the company arguably needs another hit product.  As a company, APPLE's sales growth has slowed to a crawl, and its profits slumped.  Meanwhile, the stock price, despite recovering recently (which ended today!) is still down more than 30% from the highs it set last year.    Except for the APPLE name, this could be a re-run of words from any recent HP story.

The story goes on to say that the iPhone has held up better than the slumping iPad and iMac lines (no mention of the nearly dead iPods), before *finally* turning to a couple of positive analysts.

It is little wonder than these top jobs pay so much, having to read such "What have you done for me lately" bilge.

HP Innovation going forward

HP was always about 'game-changers' but it also was always about 'platform evolution'

The 4th try on a digital voltmeter FINALLY succeeded against the ten leaders who beat HP to that biz when HP owned the analog voltmeter business.  HP did it with the first integrated circuit ever shipped in a product (a dual-diode, Whew!), and then followed that breakthrough with the idea of tying a data logger (e.g. computer) to the DVM since it was too fast for technicians to write the numbers.  That gave rise to the ruggedized HP 2116 as 'an instrument controller' and that in turn gave rise to the HP 9100A, the first 'personal computer' with transcendental functions, just what you need on your desk at home.  And soon the derivatives of the HP 9100 outsold the DVMs they were built for (in the same remote division by the way) by a factor of five, and then ten, and then twenty.  They built a 'system platform' in other words, evolving all along the way.

Ink for InkJets, way too much of the profit for many years now, came about because HP learned a lot more about ink from its gallium arsenide processing problems than from its printer divisions.  Synergy around the loop rather than political infighting that seems to characterize groups mostly today.

But I digress.  The point is that corporate innovation is different by kind than inspired genius in a corner

There was a great NY Times op-ed piece a few years back by Dick Blass, a Microsoft VP R and D from 1997 through 2004 where he was asked about the iPad vs. the Kindle since he lived in Seattle.  He said: "the much more important question is why Microsoft, America’s most famous and prosperous technology company, no longer brings us the future, whether it’s tablet computers like the iPad, e-books like Amazon’s Kindle, smartphones like the BlackBerry and iPhone, search engines like Google, digital music systems like iPod and iTunes or popular Web services like Facebook and Twitter."

We could echo his words, and substitute HP for Microsoft easily enough, right?  And the tragedy right now, in front of us from the guys and gals at Apple, is that they just showed Meg's team up badly, one more time, given her bleat: "while we're intent on having a smart phone, we haven't yet figured out how to do that without being a 'me-too' player" 

TIME TO FIGURE IT OUT.  STUDY THE EXAMPLES JUST INTRODUCED

HP and Smart Phones -- WHY NOT?

The third and fourth points made in Wired yesteday by Kyle Vanhemert, with my emphasis in BLUE, and my observations in RED:

4 Big Ideas in the New iPhones That No One’s Talking About

• BY KYLE VANHEMERT
   
• 09.11.13
   
• 6:30 AM

#3     A True Digital Self

Tim Cook called the iPhone 5S the company’s “most forward-thinking phone yet.” What else is he going to say? But more so than the new 64-bit processor, the improved camera, or even iOS 7 itself (which are the features nearly all the tech pundits in the Valley commented about), there’s one iPhone 5S feature that truly is forward-looking, in a potentially game-changing way. It’s the fingerprint sensor.

On the surface, it does seem a bit gimmicky. Just like those Android phones that unlocked themselves by scanning your face, there’s an element of a cheesy sci-fi that tags along with the idea of fingerprint scanning. But as Ive reminds us, “it’s not just rampant technology for technology’s sake.” Apple has a plan for Touch ID, and the fact that the idea of the fingerprint scan is such a familiar one gives it a head start.

The thumbprint is a psychologically powerful mode of authentication.

Your average person doesn’t know anything about RFID or PGP or how secure any of it all really is (perhaps as they’ve gleaned from the news lately, not very). But they do know that scanning into a building with a fingerprint is good enough for bank vaults and high-level government clearance, at least from what they’ve seen in the movies. Apple knows that in a world consumed with privacy concerns, the fingerprint has a decent chance of being accepted as the password of the future. In a clip dedicated to the feature, Apple’s Senior VP of Hardware Engineering, Dan Riccio, comes right out and says it: “The fingerprint is one of the best passwords in the world. It’s always with you, and there’s no two alike.”

The immediate plans for the technology are clear. The thumbprint will be your pass code into your phone. It will let you buy things from iTunes with the single mash of a thumb, no fingertip pecking required. In combination with iBeacon, the Bluetooth Low Energy protocol baked in to iOS 7, the tiny new finger-sensing home button could be the biggest, smallest step we’ve seen towards a future where we’re buying stuff with our phones, not our wallets.

But Touch ID has farther reaching implications than simply letting you walk out of Walgreens without stopping at the register. Right now, we’re at a delicate locus where privacy is a greater concern than ever and where our digital selves are fragmented across countless platforms, apps and services. The catch, though, is that the next generation of interactive, digital experiences could well depend on some sort of unified personal profile–a more portable digital identity, including your preferences, your apps, your content, your settings and the rest, that could be brought from device to device. The fingerprint could be the key to all that.

It doesn’t solve issues of privacy and security out of the gate–not by a long shot. Armchair critics responded to the news of the iPhone 5S sensor with a common refrain: one more thing for the NSA to collect. Still, though, the fingerprint is a psychologically powerful mode of authentication. As we’ve seen, our usernames and passwords are simple puzzles to be cracked; the rise of sophisticated phishing makes them as insecure as ever. Two-step authentication remains a slightly mystifying pain in the ass. A thumbprint is essential, and elemental. It’s convenient and, at least in theory, uncrackable. These are all things Apple’s evoking when they write, on the website for the new iPhone, that the Touch ID system is “inspired by a perfect design: your fingerprint.”

Those unique qualities give the fingerprint the power to usher in a totally new paradigm for mobile computing–one where your “digital” identity isn’t just a bunch of different sets of usernames and passwords and a scattered assortment of data profiles, but something that is actually, fundamentally, you–a digital version of your real, flesh-and-blood identity, as linked by your thumb.

As designers look to the future–one where real world experiences that seamlessly blend devices and services are privileged over discrete use cases and sandboxed apps–this type of centralized digital identity will be paramount. Services like IFTTT have showed us the power of linking up isolated services and features; how jerry rigging Twitter to talk to Dropbox to talk to your Photo Roll can come up with some novel workflows. In much the same way, the thumbprint is poised to be the connective tissue for the cross-platform experiences of tomorrow, where data profiles can be shared in vastly more flexible ways. Walk into a room, and all the devices inside it–not just the computers and TV screens but the lightbulbs and thermostat, too, potentially–will know it’s you. Apple wants to be at the center of all that. When Jonny (sic) Ive says “Touch ID defines the next step of how you use your iPhone,” he’s not just talking about how you unlock the thing. What he’s hinting at is use cases we’re just now starting to dream up.

#4  Body and Context Aware

The iPhone 5S’ fingerprint sensor isn’t the only way the device more closely links itself to our meaty selves. In addition to the new A7 processor, Apple announced something called the M7–a “motion coprocessor” that taps into the phone’s accelerometer, gyroscope, and compass to give the device a better picture of what you’re actually doing from moment to moment. Instead of just knowing “moving” or “not moving,” developers will be able to tell if you’re standing, walking, running, or driving. Accessing this type of sensor data isn’t anything new, but with the M7, the iPhone 5S is going to be collecting it continuously, figuring out what it means, and serving it up for apps to integrate as they will–all without draining the battery.

On a basic level, those situational smarts will allow for more context-aware behavior throughout our devices. The new iPhone, for instance, will sense when you’re driving and won’t try to connect you to every Wi-Fi network you speed past. That’s just one annoyance smoothed out, but the M7 could let Apple fine-tune the iOS 7 user experience to an unprecedented degree.

The iPhone 5S will pass along that capability to third party apps, too. As Phil Schiller explained on stage, a new CoreMotion API will include some sort of standardized analysis of all your movements and what they mean in real world terms. So it won’t be up to the Nike app to figure out if you’re running, walking or biking–the app will be able to rely on Apple for that analysis and design around it accordingly.

That again might seem like a small thing, but looking forward to the future of wearable, context-aware devices, it’s an important foundation to establish. Companies like Nike and Jawbone hire people solely to do this type of analysis, figuring out algorithms that let their devices understand how, specifically, their users are being active. By standardizing it all, Apple’s paving the way for apps that have a more agreed-upon understanding of what’s going on around you, or with you, and opening up the potential for more nuanced and sophisticated responses to it. If your iPhone senses that you’re swiveling slightly side to side between the hours of 9 and 5, say, it could be able to tell that you’re probably at work, at your computer–maybe a situation where it makes more sense to route iMessages to your main screen.

It will be up to developers to come up with ways to make use of this sort of data–experiences beyond just more sophisticated fitness apps. But the M7 and new CoreMotion API are indeed forward looking. They’re the first small step toward a much richer body computing platform. And plus, peering ahead a product cycle or three, the M7 shows shows Apple dabbling in components that can continuously monitor sophisticated sensors on a tight battery budget. The type of budget you’d have to work with for something like an iWatch.

***

So here we are, living in a two iPhone world. Both the iPhone 5S and the 5C are just what we expected, but they hide within their designs some key insights to Apple’s future. The iPhone 5C is the iPhone for today, where growing segments of people might not care about the iPhone’s cachet or its processing power so much as the ability to own a new, different, funky, and thoroughly personalized gadget. The iPhone 5S is the iPhone for tomorrow, where, thanks to sophisticated sensors and smarter software, we won’t need to take our phones out of our pockets nearly as often in the first place.

Meg, HP, and Phones

Recall the concern when HP first screwed up PCs?  No, it wasn't in 2011 versus Lenovo, or 2002 vs Dell and should HP buy Compaq, or in 1996 for the great Platt/Roelandts vs Hackborn shootout, or 1990 vs. Dell, or 1986 vs Compaq or even 1984 vs the Mac, it goes back to the HP 85 from Corvallis.  Nonetheless, the key thing is that HP persisted, and eventually found a winning combo.

Wining, that is, if you figure that a $50B revenue line annually with some profit has been a good idea.

The key thing for many people all along the continuum was HOW CAN HP BE A COMPUTER COMPANY LEADER if it doesn't have a leading PC.

Echoes of that argument surface perennially now with Apple owning the smart Phone market and the iPad market.  "We must have one" is the mantra from Meg on down.

BUT, recall my post of 4/13/13 where I quoted Meg being quoted in England, saying:
Second, re mobile devices, Meg bristled a bit, and said, first of all, we're a factor now in multi-purpose laptop/tablets (e.g. the top comes off and it becomes a tablet -- see my blog last week re the Ultra Envy II), and 'we're a factor in tablets with our new Android Slate 7 (I must have missed the market splash on this one somehow).  But the new news is that "while we're intent on having a smart phone, we haven't yet figured out how to do that without being a 'me-too' player" which contradicts her statements a few weeks ago at the SF analyst briefings.  Good for her for 'fessing up, and great to hear that she doesn't intend to play 'me-too' just to be 'in the space'.

Here's the issue.  Yesterday Apple announced two new iPhones.  Neither was noteworthy; in fact, most reviews initially were tepid.  And the drumbeats for months now have said, Apple's lost its mojo, with Jobs dead and Cook asleep.   But HP didn't announce a phone.  And in Wired, one astute journalist saw something in the Apple announcements that I find significant.  In fact, VERY SIGNIFICANT.  And HP could have led with these kinds of innovations and gotten back in the fray.  They've had all of this technology for a very long time.  They don't however seem any longer to have the mojo, do they?

To wit, here are Vanhemert's first two (of four) points, with my emphasis in BLUE, and my observations in RED:

4 Big Ideas in the New iPhones That No One’s Talking About

• BY KYLE VANHEMERT
 
• 09.11.13
 
• 6:30 AM

Yesterday, Apple had its annual iPhone bonanza. On one hand, it was the biggest announcement since the original iPhone. Today, for the first time ever, there are two iPhones. At the same time, though, the event held few surprises. The colorful iPhone 5C had been unveiled prematurely by a flurry of leaks, and the iPhone 5S, with its gold flavor and fingerprint sensor, had been similarly sniffed out. Still, in the finer points and features of these new products, Apple is laying the groundwork for its future as a company–and, potentially, the future of mobile computing. Here’s what we’re reading in the tea leaves.

The Power to Personalize

The iPhone 5C, a phone which Jony Ive called “beautifully, unapologetically plastic,” was assumed to be a foray into cheaper territory–a defensive move against the lower priced Android handsets that have been gaining ground worldwide. But to understand the iPhone 5C purely as an cheap play, or one for the international market, is all wrong. What the device is, really, is a bold step by Apple into the world of fashion, customizability, and personal preference. For years, your decision when you picked an iPhone had been limited to black and white. Now, you’ve got five options to pick from.

But that’s just the start. The iPhone 5C’s weird swiss cheese case, with a grid of circles carved out on the back so you can see the candy-coated hardware underneath, is an even more unambiguous sign of how important Apple thinks personalization is at this point....

One of Android’s big draws, especially in the first few years of the smartphone era, was the customizability of its software. But kids don’t care about ROMs and launchers. They care about colors and expression. With the iPhone 5C, Apple’s tapping into the allure of outward, broadcasted preference–something that the Android ecosystem, though diverse in its SKUs, still doesn’t really offer. This time next year, the iPhone 5c is going to be the phone coveted by everyone age 13 to 23.

Recall that the Apple II, originally for Geeks at the Homebrew Club, sold seven million into K-12 schools, changing forever the ability of American kids to get comfortable with, and then skilled at, software a half-generation ahead of the rest of the world.  And kids, plus artistes, gave the Mac its major cachet.

To see what a departure the case really is, it’s worth looking at it in the context of Apple’s past storage endeavors. The iPhone 4′s bumper was colorful, sure, but its design was informed purely by functionality–the insulating rubber ring was a direct response to concerns about signal loss when gripping the iPhone 4′s antenna band. The iPad’s ingenious magnetic cover added a dose of color and preference too–but more than spunk, the draw was again functionality: it kept your screen a little bit cleaner and safer and let you stand the iPad up in bed while you were watching Netflix.

The holes on the iPhone 5C’s case, on the other hand, have zero functional purpose. They’re purely aesthetic. And in that light, you can see them as a sort of admission on the part of Apple. Jony Ive’s fanatical attention to detail, in a way, painted the iPhone into a monochrome corner. Maybe the iPhone 5 did really represent some sort of end of the road for smartphone design–at least in the current understanding of those devices. Maybe it had reached an iterative dead end, leaving no outward surface left for Ive to work his magic. Maybe they’d chamfered all they could chamfer. There’s a chance that they’ll start over with the iPhone 6, chucking everything out the window and coming back with some wild curvaceous glass shoehorn, but in the meantime, the iPhone 5C is a clear signpost to the places where Apple thinks smartphones are still worth getting excited about: personality, color, and customization. In other words: fun.

A More Harmonious Gadget

The iPhone 5C is noteworthy for another reason: reconnecting the design language of Apple’s mobile hardware and software. The disconnect between the soul and body of the iPhone, up until this new, cheaper one, has been profound. Game Center’s ham-handed skeuomorphism was silly enough on its own, but viewed in the context of its space-age aluminum container, it was positively jarring. The iPhone 5C and iOS 7, on the other hand, are a perfect match. As Ive says in the product video, the new iPhone “dramatically blurs the boundary” between the hardware and the software. The phones even come pre-loaded with wallpaper matching the color of the device itself.

What it amounts to is the most harmonious marriage between Apple software and Apple hardware since the Bondi Blue iMac and the lickable baubles of OS X. And that’s totally by design–though it shouldn’t come as a surprise. Whereas before we had Jony Ive taking us to the moon and Scott Forstall taking us to the craps table, now Ive’s responsible for the user experience through and through. Apple’s always had a leg up on competitors thanks to the fact that they’ve made their hardware and software. The iPhone 5C is the first time in a while it’s actually looked like it.

This is the hallmark of the original MacIntosh.  Built famously around XeroxPARC's GUI (graphical User Interface) with the novel WYSIWYG (What You See is What You Get), it combined 'intutive' icons and their invoked actions, along with the 'amazing' ability to print just what you saw on screen.

It took Microsoft -- the leading SW company of its day, a mere six years to copy this, poorly.  And in the process, eventually we've all come to expect such behavior from our machines.   It's lost in antiquity that it also took HP New Wave for Microsoft to copy, and HP Motif to make Windows 3.1 icons '3D' which was the acceptance criteria that finally made Windows viable.

As Vanhemert points out, until Jove 'got control' of the SW and HW 'integration' this was not happening in the iPhone world.  Pity.  Thank goodness it is now addressed

REPOSTING from Phil McKinney's blog

Phil, now at CableNet in Denver after a brilliant try as CTO at HP for five years, has a Facebook page, this one devoted to today's WSJ news re the Dow Jones 'removal'

DOW sore at HP

Hummn, maybe we should bring Hurd back?  The Dow Jones index announcing that HP and two others will be dropped from the 30 company index today -- when you're down, everyone starts kicking

By 

MATT JARZEMSKY

 And 

COLIN BARR, in the Wall St Journal today:

Alcoa, a Dow component for 54 years, will be replaced by athletic gear makerNike Inc. NKE +1.07% Payments company Visa Inc. V +2.73% will replace H-P, which joined the index in 1997, and securities firm Goldman Sachs Group Inc. GS +3.21% will supplant Bank of America, which spent five years in the blue-chip benchmark.

The changes, which will take effect with the close of trading on Sept. 20, reflect the companies' declining share prices, S&P Dow Jones Indices LLC, the company that oversees the Dow, said in a statement.

The changes "were prompted by the low stock price of the three companies slated for removal and the Index Committee's desire to diversify the sector and industry group representation of the index," the statement said.

While their performance has been mixed this year–H-P is up more than 50%, while Alcoa is down almost 7%–all three departing stocks have underperformed the broader stock market in recent years. Shares of New York aluminum maker Alcoa closed Monday at $8.08, down from $40 as recently as 2007. H-P, the Palo Alto, Calif., computer maker, ended at $22.36, down from $50 in 2010. Bank of America of Charlotte, N.C., was at $14.48, down from $50 in 2007.

The Dow's Ins and Outs

Changes since the late 1980s.

View Graphics