Apple made a splash on Thursday unveiling new software for its venerable iPhone, making the device more assessable to software developers and enterprise customers, but investors took a mixed view of the announcement on Friday.
Shares of the company rose just over 1 percent, gaining $1.47 to $122.40 to close Friday trading on the Nasdaq. In afterhours, Apple lost a quarter.
The Cupertino, Calif.-based consumer electronics maker unveiled new corporate functionality for the iPhone at its headquarters yesterday, including tools to synchronize mail with Microsoft Exchange servers, a corporate favorite.
The move was seen as necessary for Apple to reach its goal of 10 million iPhones sold by the year's end.
In recent weeks a number of industry watchers have questioned whether the company would be able to meet its goal as competition increases and Asian manufacturers turn out lower-than-expected production.
Enterprise features may enable Apple to tap into a market beyond consumers, including the devoted users of Research In Motion's Blackberry, the ubiquitous phone of choice for millions of business users worldwide.
During the 90 minute presentation, Apple strived to show-off the phone's new business muscle, and announced it has already begun working with firm's like Salesforce, Genetech, Nike, Disney, and other large companies in adopting the iPhone for the corporate environment.
[The announcement] increase traction for iPhone amongst business users, though more with small businesses, and less with large enterprises, commented Mike Abramsky of RBC Capital. The analysts sees the company adding 400,000-800,000 Exchange users by the end of the year.
Digging deeper into Blackberry's market space may prove more difficult however as the RIM has been the premiere business provider for several years.
Most businesses using the BlackBerry platform have also purchased specialized hardware, which represents a significant hurdle for widespread iPhone adoption in business environments, Gene Munster of Piper Jaffray said in a research note.
But American Technology Group analyst Shaw Wu said that Apple's adding of support for Microsoft Exchange will plug a key weakness that has kept the iPhone from gaining a larger piece of the corporate market since its debut last June 29.
We believe Apple's implementation of ActiveSynce is superior to existing ActiveSync implementations out there, Wu said.
A beta version of the new software package is available now, with the full version set for release as a free download in late June. Apple Chief Executive Steve Jobs said developers will be able to join the iPhone development program for a $99 fee, and will keep 70 percent of all sales of applications developed for the iPhone.