04/25/2007, 6:55pm, EDT
Wednesday, April 25th
Changes in accounting for Apple TV, iPhone
When justifying the decision, Oppenheimer pointed to the radically different business model for both products. Both the phone and media hub will receive a relatively steady amount of software features for free over their respective lifespans, meaning that the income from each sale in effect amortizes the software development costs after the product is released. The financial chief touted this as playing on Apple's strength with software..
"We are taking this bold step to leverage what we do best," he said.
Oppenheimer declined to predict how much money each iPhone would bring in per month when prompted by one analyst's line of questioning. There are multiple factors at work that could affect the actual income, the CFO said, ranging from the cost of a particular model to variances with income from AT&T. All Apple-made iPhone accessories will be counted solely as one-time events.
An explanation of which features would be added, and how frequently, was beyond the scope of the results phone call.
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However, the change for AppleTV seems to indicate that they may be working on a subscription service for the iTMS and movies. Otherwise, how can they claim it as a product with a long lifespan?