Don’t expect iPhone 6S to save Apple

Tough comparison, anticipated incremental changes could fuel first annual iPhone sales decline

With Apple Inc.’s stock suffering, investors are hoping for relief from the expected launch of a new iPhone in September.

Don’t count on it.

The initial impact of Apple’s AAPL, -3.58%  expected September launch of an iPhone 6s and a 6s Plus may be the first step toward Apple’s first year-over-year decline in iPhone unit sales. And since the tech giant counts on the smartphone to drive the majority of its profit and revenue, any disappointment is bound to hurt its stock and fuel questions about whether the iPhone has peaked.

Apple will report its fiscal fourth quarter results in October, and the consensus on Wall Street, according to FactSet Research, is that the tech giant will report sales of 48 million iPhones in the final three months of its fiscal year. After selling 183.2 million smartphones to start the year, an annual total of 231 million iPhones sold would reflect a huge gain of 36.6% from the 169 million sold in the 2014 fiscal year; in 2014, iPhone sales gained less than 13%.

Hargreaves wrote that he expects iPhone sales to decline about 8% in fiscal 2016, mostly due to a tough comparison with those big sales gains in 2015, which were fueled in large part by China. Hargreaves is more pessimistic than the consensus analyst estimate, but big gains are not expected: FactSet reports that 31 analysts expect an average of 235 million iPhone unit sales in the 2016 fiscal year, which would be less than 2% growth from this year’s expected sales.

Reports suggest Apple’s next iPhone will launch sometime in September, with a Sept. 9 launch event date now bandied about, based on some leaked memos from carriers which appear to be planning on a Sept. 14 in-store sale date. Apple does not comment on unannounced products and it has not yet confirmed an event next month, but in the last three years, Apple has unveiled new iPhones during the first two weeks in September. It held an October launch event in 2011 for the iPhone 4s. 

The expected iPhone 6s so far sounds mostly like an incremental update, which could lead fewer users to upgrade. Jordan Edelson, founder and chief executive of Appetizer Mobile, believes that the new iPhones will have the same chassis as the current iPhone 6 models, with more memory, a better 12-megapixel camera and battery life improvements. 

“They are not changing the chassis/form factor that much,” he said. 

He is also expecting Apple to add its Force Touch technology now in the Apple Watch, which lets users press more firmly on the screen to bring up additional controls. He is not expecting a tougher, scratch-resistant sapphire screen, nor the patented technology that makes the phone right itself when it is dropped. 

“I think they will still do well, I just don’t think it will be strong as last year,” said Edelson, whose New York-based company is a mobile app development company. “I think some people will just wait and see and see if they can hold out until next year,” when Apple is expected to launch an iPhone 7. 

Edelson believes iPhone sales “will be strong regardless, it will not be a flop by any means.”

A true flop isn’t necessary to freak out Apple investors, though. They are already in a nervous state, with the failure to disclose Apple Watch sales data leading many to believe it is underperforming Wall Street’s initial expectations. In addition, the iPad has not recovered from a decline in sales growth as customers upgrade less frequently than with iPhones, leading Apple to launce partnerships seeking corporate customers for the tablet as a way to fuel growth.

Piling on are some scary predictions from technical analysts, who analyze stocks based on trends and repeated patterns in trading charts.This week, some technical analysts noticed a bearish chart and predicted a pattern of a so-called “death cross” in Apple’s stock.

Wall Street has been enamored with Apple for years, and much of that love in recent years has come from the hot-selling iPhone, which grew at a compounded annual rate of nearly 100% in the full seven years since it was launched. It has been a huge cash generator that has added to Apple’s enormous cash pile and is fueling its hefty $200 billion cash return program this year to investors. In its fiscal third quarter, iPhone revenue of $31.4 billion was about 63% of its total revenue of $49.6 billion. 

FactSet indicates revenue from the iPhone in fiscal 2016 is currently expected to be slightly lower compared with 2015, with expectations of $153.3 billion in iPhone revenue for next year, versus $153.8 billion expected for fiscal 2015. Apple’s total annual sales in fiscal 2016 are forecast to rise about 5% to $247.6 billion from estimates of $235.7 billion for 2015.

Whether or not those estimates ends up being too conservative, on target, or not conservative enough will depend a lot on how the iPhone fares. But the odds of Apple hitting double-digit growth in a potential off-year for the iPhone right now appear to be pretty low.

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Yankees skipper Joe Girardi shows off his new app Portalball, a sci-fi themed baseball game 

Joe Girardi promotes his new Portalball App in Manhattan on Wednesday.

Joe Girardi promotes his new Portalball App in Manhattan on Wednesday.

Leading the Yankees to a sizable lead in the American League East apparently isn't enough for Joe Girardi. So the manager is branching out…into augmented reality gaming.

At a launch party at Modell's in Times Square Wednesday morning, Girardi debuted a new iPhone and Android game he helped create alongside phone app development company Appetizer Mobile.

The app is called Portalball, a sci-fi themed baseball game that allows players to hit and throw balls into, and catch balls out of, glowing blue portals that pop up on the screen. The gameplay is superimposed over what the device's camera captures in front of the player — "360 degrees in your own environment," CEO and developer Jordan Edelson said.

"I just thought it was a way to include other people besides just baseball fans, which I thought was important," Girardi said while sporting a black Portalball baseball jersey. "Because not everyone loves baseball as much as I do."

The app is free to download, but a "good portion" of any proceeds the game produces initially will go to Girardi's foundation, Catch25, which offers financial and other support to individuals affected by economic hardship. Girardi started the foundation with his wife, Kim, in an attempt to provide hope for people who are struggling.

"Dealing with a lot of the things I've had to deal with in my life and watching my mother go through cancer," Girardi said, "I think it's important that we give people hope. Because without hope, I don't think there's anything."

From the early stages of development, Girardi vowed to marry the app with his foundation.

"It was a situation where you do all the work before, and you don't necessarily have to be going out and doing huge dinners and that sort of thing," Girardi said.

Girardi got involved with the project two years ago through his agent, who approached the Yankees’ manager about partnering with Edelson to produce a baseball game. Girardi was immediately interested, largely because he understood how important apps are in the modern age. He also saw it as a chance to connect with his son, 13, and daughter, 8.

Girardi admitted his kids have the upper hand right now in Portalball, which hit the app store Wednesday, but his competitive nature will eventually take over.

"We'll have some fun with it," Girardi said.

Girardi's appearance at Modell's came hours before one of the most anticipated player debuts in recent Yankee history.

Righthander Luis Severino will take the mound Wednesday night against the Red Sox in the Bronx for his first major league start, and Girardi is eager to see what the 21-year-old with nasty stuff can offer a rotation that ranks 23rd in the league in ERA.

"This young man is going to be in our rotation," Girardi said. "We think he'll continue to grow as time goes on. But I'm curious to see how he handles it."

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Joe Girardi Helps Develop Augmented Reality Baseball Game

Augmented reality game blends baseball and sci-fi

By John Bonazzo 

'Portalball' doesn't just use classic baseballs- balls made of electricity and fire are also employed in the game. (Photo: Screenshot)

‘Portalball’ doesn’t just use classic baseballs—balls made of electricity and fire are also employed in the game. (Photo: Screenshot)

Manhattan-based app developer Appetizer Mobile is having a moment thanks to Joe Girardi. The Yankees manager worked with Appetizer to develop a new multiplayer game called Portalball, which will be unveiled on August 5 at the Modell’s in Times Square.

Appetizer CEO Jordan Edelson told the Observer that Mr. Girardi, who got the itch to develop an app after seeing his kids play games on their phones, took an active role in the game’s creation to ensure it would be involving and addictive.

“He’s added a tremendous amount of credibility to turn this concept into something more authentic,” Mr. Edelson said.

Portalball allows players to hit and pitch at variable speeds with different kinds of bats and balls, using techniques based on Mr. Girardi’s swing path.

The game combines Mr. Girardi’s baseball expertise with a gamer-friendly alien invasion plot. Sports and space may seem like strange bedfellows, but Mr. Edelson said that the two worlds melded into a cohesive whole that would make the game appeal to a wide audience.

“Our whole goal in adding the sci-fi twist was to find something for everyone,” Mr. Edelson said. “We didn’t want to pigeonhole ourselves. The sci-fi part is not overbearing, it works really well.”

'Portalball' takes over your phone screen using augmented reality so you can play "atom ball" in Times Square. (Photo: Screenshot)

‘Portalball’ takes over your phone screen using augmented reality, so you can play “atom ball” in Times Square. (Photo: Screenshot)

Portalball employs augmented reality technology, which can take over phone cameras and project the image that the phone “sees” onto its screen. This allows backgrounds and portals to constantly shift, heightening the element of surprise (musicians have also started using this technology).

Mr. Edelson called augmented reality a new frontier, which the Appetizer team experimented with to create the smoothest possible experience.

“Augmented reality is an evolving medium as the industry expands,” Mr. Edelson said. “Gameplays are more immersive and integrated into daily lives. No one was really providing a cool multiplayer experience using augmented reality until now.”

Mr. Girardi, who only has a limited window of time every day to play on mobile apps, envisions Portalball as a platform that will appeal to both competitive and casual gamers, according to Mr. Edelson. To that end, Appetizer is planning competitive tournaments to coincide with the general app rollout.

“The person that’s looking for something different will find a lot, as will the casual sports fan,” Mr. Edelson said. “It’s a very cool platform.”

There is a philanthropic aspect to Portalball as well—Mr. Girardi is donating all of his profts from the game to his charity Catch 25, which provides financial support to people in crisis.

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Joe Girardi Adds ‘App Designer’ to Résumé With Release of ‘Portalball’

With the help of an app developer, the Yankee manager’s sci-fi baseball game is ready for download 

Joe Girardi, the normally staid and reserved Yankee manager, hit upon a new idea for a mobile game app.
Joe Girardi, the normally staid and reserved Yankee manager, hit upon a new idea for a mobile game app. 

On the video screen, Yankee manager Joe Girardi takes up his hitting stance, from his now far-removed playing days. He cocks the bat in his hands, and awaits a ball from the pitcher as he did so many times during his 15-year big league career.

Yet there is no pitcher. Instead, a portal opens, roughly where the pitcher should be. And the bat in Girardi’s hand is no ordinary bat; it crackles and sparks, flames licking off it. 

But when the portal launches a ball at Girardi, fire bat or no, he knows what to do. He swings, bashing the ball far into the distance. Another portal opens, and another—and time and again, Girardi swings his fiery bat, and blasts the balls into the stratosphere. 

Welcome to Portalball. 

Two years ago, Joe Girardi, the normally staid and reserved Yankee manager, hit upon a new idea. He saw his children playing mobile apps on their phones and tablets, and decided he wanted to try his hand at creating one, a family-friendly, multiplayer game with baseball elements that he could play with his kids.

Girardi is no tech savant—he cheerfully proclaims his ignorance of Twitter or Instagram or whatever he has heard is the newest craze of the moment—so his agent put him in touch with an app developer, New York’s Appetizer Mobile. Two years later, Girardi is the brains behind Portalball, a hybrid sci-fi baseball game that will be available for download in August. Most fans, and certainly his players, would be shocked to know that Girardi now has “app designer” on his résumé.

While this may seem out of character for a baseball lifer, Girardi is no nincompoop either, owning a bachelors in industrial engineering from Northwestern. 

A screenshot of the game Portalball played in Times Square.
“I’m a little surprised myself,” Girardi admitted. “It was just an idea that we could do with families. Kids connect on phones, and they connect with parents on phones. I know I text my kids a lot, and they respond quickly. It’s just another way to have connection with family.”

In Portalball, which appears to be set against the backdrop of an alien invasion of Earth, players compete in one of three phases of the game—hitting, pitching, and fielding—to deal with the portal invaders. As in the promotional video featuring Girardi and his fiery bat, players will bat, pitch, and field their way to success against their friends using balls flying in from portals all around them. 

The game uses augmented reality technology, meaning that it takes over the phone or tablet’s camera and projects the image that the phone sees onto the phone’s screen. Users then play Portalball against that constantly shifting background, with portals opening seemingly out of the walls, ceilings, and floors of the room around them. 

When Girardi offered to demo the app on Friday, Appetizer Mobile CEO Jordan Edelson fired up the game and showed off the action from inside Girardi’s Yankee Stadium office. On the screen, portals opened and balls flew in from behind Girardi’s desk, from the autographed pictures on the wall, from near the head of Girardi’s teenage son Dante, sitting on the office couch. 

“Whoops, sorry Joe,” Edelson said, as the game screen showed him batting a pixilated ball directly at Girardi’s head. 

When Girardi’s agent, Steve Mandell, initially set him up with Edelson, the idea was to use Girardi’s expertise to create a more traditional baseball game. But as the pair tossed ideas back and forth over many months, their ideas spread wider, eventually landing on the premise of a sci-fi/baseball mix to differentiate it from the competition. 

“There’s a lot of generic baseball games out there. We wanted to do something different,” Edelson said.

A screenshot of the mobile app Portalball

Girardi would toss a concept Edelson’s way, and Edelson would assess the feasibility; or Edelson would send a suggestion, and Girardi would assess how well it fit his vision. Girardi didn’t take part in the technical development of the app, serving more as the idea man.

“It was all way over my head, developing it. But we probably talked once a month, once every six weeks about different ideas,” Girardi said. 

Once they had settled on the basics, the Appetizer Mobile team came to Girardi’s house to capture his swings and athletic movements, which were to appear in the game; when a Portalball player swings, it’s Girardi’s specific swing path that is represented on-screen.

“That’s probably why there are so many swings and misses,” joked the career .267 hitter.

Kids connect on phones, and they connect with parents on phones. I know I text my kids a lot, and they respond quickly. It’s just another way to have connection with family.

—Joe Girardi

The app is free to download for both Apple Inc.’s iPhone and phones running Google Inc.’s Android operating system, but there are numerous in-app purchases that enhance the experience, like Girardi’s fiery bat, or a ball bearing his signature. Switching bats and balls is intended to be a core part of the gameplay: “Each ball has unique powers and abilities, and based on your matchup, an atom ball might be better against a fire bat, and so forth,” Edelson said. 

All Girardi’s proceeds will be donated to his charity, Catch 25. 

Girardi will fully unveil the app on August 5 at Modell’s Sporting Goods in Times Square, where he promises to take on attendees in Portalball matches. That could be a risky proposition—he may be the game’s creator, and the swings may be his own, but that doesn’t mean he’s any good yet. 

“I stink—I’ve gotta practice,” Girardi said, nodding over to his son, Dante. “I’ll practice with this guy.”

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