iPhone 5C demand lower than expected, says Tim Cook

It is rare for Apple, especially its CEO, to admit to some level of error so when it does, everyone is all ears. This has happened yet again as Tim Cook admitted that they might have overestimated the popularity of the iPhone 5C, whose market performance wasn't as they had expected.

To be fair, the brightly colored plastic-backed mid-range iPhone didn't flunk sales. At the end of the quarter, the iPhone 5C sold 51 million units. Unfortunately, Apple expected it to sell for around 55 million. Cook believes that this was because consumers gravitated towards a more interesting, but also more expensive, iPhone 5S.

Cook says that the features on the iPhone 5S, particular the Touch ID, ended up grabbing more attention and thus majority of the sales. The iPhone 5S is also a premium device with high-end hardware. The iPhone 5C, on the other hand, was almost similar to the iPhone 5 and its biggest marketing stunt was the colorful design, yet another Apple first since the company left the colorful iMac era.

This was also the first time that Apple introduced two new iPhone models at the same time, which could have led to a slight confusion among Apple fans. Apple doesn't usually reveal its per-product sales numbers, but it has reduced orders for the mid-range smartphone, prompting many to speculate on the veracity of reports about the iPhone 5C's weak sales.

Now the fate of the iPhone 5C remains unknown. Some think that Apple will soon scrap the device. Apple is also believed to be revising its iPhone strategy and might no longer introduce a plastic, mid-range variant when it unveils its next iPhone generation.











VIA: Apple Insider

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Apple’s Tim Cook demands bigger stock risk (and costs himself $4m)

Apple CEO Tim Cook has pressured the company board on pay, though not the way you might imagine: the chief exec has demanded his salary be more closely linked to Apple's stock price, as a result tumbling by $4m since the company failed to meet its targets. The Apple board had intended to base less than half of Cook's annual stock grants on the CEO performance-based metric it decided to shift to earlier this year. However, according to a preliminary filing with the SEC, Cook himself pushed for a greater chunk of his renumeration to be at risk, arguing that it would "set a leadership example."

The initial motivation for the board and the early numbers it collectively had in mind was to limit the risk placed on Cook's overall salary. The change in scheme won't see Cook paid more if Apple out-performs its stock goals - effectively to perform better than the other stock in the S&P 500 index - and so the "downside risk" is the only thing that could hit him.

However, Cook disagreed that he should be better insulated from Apple's overall performance, and that decision has cost him considerably this past year. The CEO argued that the scheme was an opportunity to set an example around "compensation and governance" and so requested a larger percentage than the board had in mind.

As a result, the Apple Compensation Committee opted to make a full 50-percent of Cook's stock grants dependent on how Apple performs.

With Apple's stock falling 26-percent in the August 2012-2013 period, compared to an 18-percent rise from the S&P 500 as a whole, that means Cook's entire at-risk portion of his vested stock was lost. That, CNN calculates, was worth almost $4m.

Nonetheless, that was still just a tenth of Cook's overall rewards over the past year. His salary at Apple is "only" $1.4m, but with cash and stock grant bonuses his total compensation is over $40m.

It's not the first time Cook has sacrificed more money than Apple wanted to give him. Back in 2012, he turned down a $75m dividend.




source : slashgear

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