Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
Your iPhone might be getting a big brother soon. From niche tech blogs to The Wall Street Journal, the media is abuzz over reports that Apple (Nasdaq: AAPL ) plans on launching a new, larger touch-screen device. Whether the gadget is more akin to a beefier iTouch, a netbook, a tablet, or something completely out of left field remains to be seen. However, when Apple starts fooling around with a new product, investors tend to take notice; the company has a pretty impressive track record of product launches that inevitably turn into the next big thing.
Well, this is all speculation
Indeed it is, but there is some traction behind the rumors. On Monday, there was a report out of Chinese-language newspaper Commercial Times that Taiwanese firm Wintek would supply touch panels. That claim was followed up on Tuesday by a Dow Jones story that substantiated the news, but the article's source tempered enthusiasm by reporting "specifications and functions are still under evaluation." However, there is one common theme in all the hullabaloo: No one's saying that the device will function like a typical netbook.
One of the most striking considerations from initial reports is how many markets the device could potentially compete in if it's actually a tablet/netbook hybrid. The hybrid would instantly become a viable competitor to Amazon's (Nasdaq: AMZN ) red-hot Kindle in the e-book space, and it would provide a larger screen and computing power to further compete with Sony (NYSE: SNE ) and Nintendo's (OTC BB: NTDOY.PK) handheld video game offerings. Also, let's not forget the netbook market, where U.S. companies like Dell (Nasdaq: DELL ) and Hewlett-Packard (NYSE: HPQ ) have been struggling with the reduced margins inherent in netbook sales. However, my thought is that those companies needn't be as concerned. Apple won't produce enough units to make a serious dent in netbook market share; rather, it's creating a niche product whose effects would be spread across the devices listed above.
Foolish bottom line
The best part of all this is that if rumors prove true, Apple has decided to engage the netbook competitive threat under its own terms: inventing a new platform. Apple doesn't do well in a price race to the bottom; that's not its style. The company is best when it's innovating and creating new platforms that consumers crave. I couldn't say this better than Foolish colleague Tim Beyers, who offered the following to in late December:
Apple isn't a skinflint, and it shouldn't try to be one. It should forget netbooks. The iPhone is already as good as one, and it'll only improve as the App Store expands its offerings. It's the platform that the much-mocked Newton hoped to be but never was, and it's the precursor to my theory for Apple's Next Great Thing -- a Wi-Fi tablet Mac based on the Safari browser. If I'm right, look for it in 2009.
Starting to look like prescient words from Mr. Beyers. While many have been quick to shovel dirt on Apple's grave in the wake of Steve Jobs' medical leave and lowered Mac sales thanks to price-conscious consumers, Cupertino's got something brewing that might just address those concerns.
Get your Apple on with related Foolishness: