In this version of the Apple (AAPL - Free Report) roundup, I’m discussing its settlement with Samsung, its all-new Maps application, rumors around Face ID for iPad, the new feature targeting 2018 election news and some analyst attention. So here goes-
Apple and Samsung have settled a long-running dispute with each other, according to a court filing by Judge Lucy Koh. They cannot change their minds later and file another complaint on the same matter based on their “litigation with prejudice” submission. The iPhone maker accused Samsung of copying certain very basic design and utility patents and a jury found in 2012 that 11 Samsung models did, in fact, infringe Apple patents.
After that it was a question of determining the amount of damages due. Samsung took the matter to the Supreme Court, which ruled that a company was not required to part with all profits from a device when only parts comprised infringed technology.
The jury had last awarded $539 million to Samsung, which said at the time that it would appeal the decision. Since $399 million was already paid, only $140 million remained due under the verdict. But since the matter was settled out of court, what if anything it finally paid remains unknown.
The patents are almost irrelevant today since both Samsung and Apple have churned out many more and better models and according to some reports, Apple has done its own share of infringing. So it’s a good thing the two have finally decided to call it quits after paying for years of litigation.
Doubling Down on Maps
TechCrunch reported that Apple is overhauling its much criticized Maps application to build something from the ground up and using its own data the way that Alphabet (GOOGL - Free Report) does. So it’s using a combination of street cars, satellites and data from users who have explicitly agreed to share. This will allow it to get in a lot more detail like ground cover, foliage, pools, pedestrian pathways, parking lots, among other things, so it’s useful for both pedestrians as well as those using vehicles.
Apple recognizes that strong maps are the basis for many other apps that rely on the location data, so it has spent the last four years building that data pool. It’s available to U.S. users today, before a more gradual global rollout.
Relying on its own data, Apple will also be able to push out updates quickly, and even in real time where required.
This is doable today because there are a billion Apple devices out there, so even if a portion of those share data, Apple may still be able to offer services like real time traffic updates.
This, of course, is a big negative for TomTom, which has been providing Apple with mapping data ever since Apple terminated its agreement with Google. Apple said it will continue to use TomTom inputs for now, but the partnership’s days appear to be numbered.
Face ID is Apple’s new system of unlocking devices like its iPhone and soon, according to rumors, also its iPad. Actually, it isn’t just a rumor, but more of an educated guess by one Troughton-Smith. He found some code in the beta version that seems to indicate that AvatarKit will be in the iPad. And since this is used for Apple’s Animoji, which in turn uses its TrueDepth camera, which is behind FaceID, it follows that FaceID is coming to the iPad. Or, that the iPad will be FaceID capable.
Moreover, with iOS 12, iPhone X users will be able to record “alternate appearances” that make the identification more accurate. For example, if you save more of your appearances, such as when you’re wearing makeup or specs, it will recognize you better. If it’s indeed coming to the iPad, the feature could also let you save the images of your family members, so they too can unlock the device.
The hype aside, the technology already has detractors who claim it’s less secure. Researchers in Vietnam for example have unlocked an iPhone using a look-alike mask. Same would be the problem with identical twins.
Note that Samsung was recently granted a patent for technology that uses a NIR (near infrared) light source to detect the user’s iris. So Samsung’s soon-to-be-announced S10 will likely be equipped with a 3D sensing camera enabling facial recognition much like Apple’s Face ID.
Smart Move on News
With the 2018 mid-term elections around the corner, technology companies are bending over backwards to prove their neutrality and ensure that every bit of news out there is authentic. Apple, which doesn’t have a network and doesn’t depend on advertising, can naturally do this much better than companies like Facebook (FB - Free Report) and Google.
So for the elections, the Cupertino, CA-based company has created a special section in Apple News that will be devoted to the mid-term elections and bear the Midterm Elections 2018 banner. Stories that appear here will comprise both controversial content and otherwise, but Apple News editors will ensure that they are trustworthy, well-sourced, uninflammatory, relevant, and devoid of rumor and propaganda. Apple is getting professionals to curate/scrutinize the section.
While the editors have been empowered to take a call on issues based on some broad principles, they still have considerable latitude. This can be both good and bad: good because it can minimize the chances of fake news circulating and bad because what they pick can be biased. Still, David Chavern, CEO of a nonprofit trade group called News Media Alliance representing 2,000 news organizations in the U.S., is happy with the way Apple is going about things. So let’s see how it pans out.
Loop Capital Analyst Weighs In on Apple
Analyst Ananda Barua wrote, “Specifically, we believe the combination of ongoing Services momentum (which we believe to be structural) and the introduction of a lower-ASP [average-selling-price] LCD-based iPhone X (upon the September launch of iPhone X Version 2, or Xv2) can provide tailwind to both revenue and iPhone X units that wasn't present for the iPhone Xv1 launch." He also expects to see a favorable mix of higher end phones that he expects will be positive for margins and profits.
Apple shares carry a Zacks Rank #3 (Hold) unlike Facebook, Western Digital Corp. (WDC - Free Report) , Internet Initiative Japan (IIJI - Free Report) , Dell Technologies , Cyberark Software (CYBR - Free Report) or Sytel , all of which are buy-ranked. Or take a look at the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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