Could ‘Er­ror 53’ sig­nal bad omens for Ap­ple?

Financial Mirror (Cyprus) - - FRONT PAGE -

Ap­ple Inc (AAPL: NAS­DAQ) is against the ropes, and the lat­est tech­no­log­i­cal furore is un­likely to help the com­pany re­store its once im­per­me­able im­age. Just re­cently, Ap­ple and Al­pha­bet were go­ing toe to toe in a bat­tle for tech mar­ket dom­i­nance. Al­pha­bet Inc (GOOGL: NAS­DAQ) posted strong Q4 earn­ings for 2015, based largely on the per­for­mance of its cash cow Google. Ap­ple, by con­trast, has been plagued by the poor per­for­mance of its lat­est prod­uct line in the iPhone 6 and the iPhone 6S. Slump­ing sales fig­ures at Ap­ple have ex­ec­u­tives and stock­hold­ers deeply con­cerned, and this is be­ing re­flected in the share price of the world’s most valu­able tech­nol­ogy com­pany.

Ap­ple is cur­rently trad­ing at $94.02 per share with a mar­ket cap­i­tal­i­sa­tion of $521.30 bil­lion. The com­pany has a price/earn­ings ra­tio of 10.01 and an earn­ings per share of 9.40. The stock’s div­i­dend and yield are 2.08 (+2.15%). The 1-year tar­get es­ti­mate price for Ap­ple is $136.25, and the next earn­ings date is slated for re­lease on the 25th – 29th of April 2016.

The gen­eral con­sen­sus among an­a­lysts for buy­ing or sell­ing Ap­ple stocks is based upon a host of fac­tors, in­clud­ing the opin­ions of re­search firms up­grad­ing/down­grad­ing their per­cep­tion of Ap­ple. The mean rec­om­men­da­tion for this week for Ap­ple comes in at 1.8, with 1.0 rep­re­sent­ing a strong buy and a 5.0 on the op­po­site end of the spec­trum rep­re­sent­ing a sell.

The high price tar­get for Ap­ple stock is $200 per share and the low is $102 – sig­nif­i­cantly higher than the cur­rent price of Ap­ple stock. In 2016, there have been three no­table upgrade/down­grades of the com­pany, start­ing with the Jan­uary 6 down­grade by Rosen­blatt from a ‘buy’ to a ‘neu­tral’ rat­ing.

On 11 Jan­uary, Mizuho up­graded its rat­ing on Ap­ple from ‘neu­tral’ to ‘buy’, and on 12 Jan­uary, Bank of Amer­ica Mer­rill Lynch up­graded its rat­ing on Ap­ple from ‘neu­tral’ to ‘buy’. Based on the over­all con­sen­sus of an­a­lysts and re­search firms, Ap­ple ap­pears to be a strong buy, but there are se­ri­ous con­cerns dog­ging this tech­nol­ogy stock.

The Er­ror 53 dilemma is im­pact­ing upon thou­sands of iPhone 6S and iPhone 6 users world­wide. What hap­pens with this er­ror mes­sage is that phones are ren­dered de­funct – ef­fec­tively un­able to be used since the se­cu­rity pro­to­cols are deemed to be breached and the phone is shut down. The lat­est iOS for Ap­ple iPhones has a built-in se­cu­rity fea­ture ca­pa­ble of shut­ting down the phones once a re­pair has been un­der­taken by some­body not con­tracted with Ap­ple Inc. Up un­til re­cently, the Er­ror 53 mes­sage has been a great mys­tery to those not in the know. Now, how­ever, the story has gained mass cir­cu­la­tion and Ap­ple ex­ec­u­tives, stock­hold­ers and cus­tomers are scram­bling for a fix.

Var­i­ous jour­nal­ists who have been re­viewed on this topic have in­ti­mated that the Er­ror 53 mes­sage is ca­pa­ble of killing all func­tion­al­ity on your iPhone.

The tech­no­log­i­cal glitch is sig­nif­i­cant in that it is as­so­ci­ated with the world’s most valu­able tech­nol­ogy com­pany in Ap­ple. Handsets which utilise touch ID fin­ger­prints as part of the recog­ni­tion soft­ware are the ones that are be­ing af­fected the most. If re­pairs have been made by tech gu­rus not as­so­ci­ated with Ap­ple and cus­tomers have down­loaded iOS 9 ver­sion soft­ware, the prob­lem arises. Cus­tomers are com­plain­ing of mass data loss, lack of func­tion­al­ity and what ef­fec­tively amounts to a de­funct iPhone.

The is­sue is be­com­ing an eth­i­cal night­mare for Ap­ple, since cus­tomers are loath to take th­ese ex­pen­sive devices ex­clu­sively to Ap­ple deal­ers for tech re­pairs. The is­sue is par­tic­u­larly no­table since the cost of re­pair­ing the home but­ton of a typ­i­cal iPhone 6 in the United King­dom can run as high as GBP 236.

This is pre­cisely why tech ex­perts not af­fil­i­ated with Ap­ple are be­ing ap­proached to rem­edy th­ese prob­lems, but the lat­est iOS soft­ware down­loads are iden­ti­fy­ing re­pairs not per­formed by Ap­ple ex­perts and then shut­ting down the phones ac­cord­ingly. Any in­di­ca­tion of third-party soft­ware or com­po­nents in­stalled on the phone will re­sult in an im­me­di­ate Er­ror 53 mes­sage.

Ap­ple has con­sis­tently main­tained that the only tech ex­perts to make mod­i­fi­ca­tions or re­pairs to iPhones must be com­pany af­fil­i­ated in­di­vid­u­als.

To make mat­ters worse, com­pany rep­re­sen­ta­tives, tech ex­perts and sales peo­ple have in­sisted that the only so­lu­tion to this prob­lem is the pur­chase of a new iPhone 6 or iPhone 6S. Com­pany rep­re­sen­ta­tives main­tain that the fin­ger­print pro­tec­tion mech­a­nism used by Ap­ple is con­joined with the touch ID within the phone. Only com­pany-af­fil­i­ated tech­ni­cians have the abil­ity to val­i­date that con­nec­tion; third par­ties can­not.

This pair­ing be­tween the touch ID and the fin­ger­print data is in­tri­cately con­nected to other se­cu­rity mech­a­nism such as Ap­ple Pay and this is pre­cisely why Ap­ple will im­me­di­ately and au­to­mat­i­cally block any iPhones that have not been re­paired by its own per­son­nel.

How­ever the Er­ror 53 mes­sage which is be­ing ex­pe­ri­enced by Ap­ple users is noth­ing new; it has been cir­cu­lat­ing for sev­eral months, but has only gained promi­nence now that big news sites have bro­ken the story.

Ap­ple has not been com­pletely up­front with its clien­tele about the risks that they run by get­ting re­pairs done to their phones by non-Ap­ple au­tho­rised per­son­nel. By tak­ing your iPhone, iPad or iPod Touch to be re­paired by third-party providers you ef­fec­tively run the risk of ren­der­ing your de­vice de­funct.

It is in­cum­bent upon Ap­ple users to read the fine print as­so­ci­ated with the pur­chase of all Ap­ple prod­ucts to un­der­stand that Ap­ple is well within its rights to shut down the func­tion­al­ity of smart­phones, smart­watches and other Ap­ple devices that are ser­viced by third-party providers. To date, the is­sue has largely been re­stricted to handsets which uti­lize a home but­ton and a touch ID fin­ger­print.

In in­dus­try lingo, Ap­ple Inc is ef­fec­tively caus­ing handsets and other Ap­ple devices to be ‘bricked’ which is par­lance for ren­dered null and void. More im­por­tant is the fact that all data stored on the smart­phone or de­vice will be ir­re­triev­ably lost or dam­aged.

Ap­ple CEO Tim Cook made his case that any tam­per­ing with Ap­ple’s se­cu­rity es­pe­cially with bio­met­ric data would re­sult in a shut­down of the prod­uct. It is in­ter­est­ing to point out that the only time the er­ror will be no­ticed is when the most re­cent up­date of IOS soft­ware has been com­pleted. But Ap­ple has made it clear that the pur­chase of an iPhone is but one of many pur­chases that Ap­ple own­ers will be re­quired to make with the prod­uct. And at a hefty price tag of $250 per re­pair, peo­ple are now think­ing twice about buy­ing Ap­ple prod­ucts: Ap­ple is ef­fec­tively say­ing to its cus­tomers: When you buy from us, we own you for the life­time of your prod­uct!

Newspapers in English

Newspapers from Cyprus

© PressReader. All rights reserved.