Apple’s stock is rising because Apple seems poised to capture a new market.
He’s dead on, as usual, here’s why:
Thinking along the lines of Ansoff’s ‘Product-Market Growth Matrix’, it depends how you look at it, or rather whom you ask:
From a tech-versed person’s point of view, Apple does product development; a new product in an existing, albeit never seriously worked market. The innovation is mostly software and a bigger screen; two features that, strictly speaking, do not constitute a unique selling proposition. ’Strictly speaking’ because the market is still playing catch-up with the AppStore.
From an ordinary customer’s point of view, the iPad is Apple engaging in diversification (new products in new/untapped markets). Ultimately the iPad stands for a dead-easy to use, client-host based computing solution for the masses, and Apple might’ve just invented the ‘casual computing market’ with it (on the analogy of Nintendo’s ‘casual gaming market’).
The latter is what intelligent analysts expect, why the stock is going up up up, and what competitors have to understand before they can engage in another round of “catch me if you can” with Apple.
The iPhone was a similar phenomenon. Upon release we had a case of product development, but when Apple realised the potential of native applications, it quickly went from product development to diversification.
