iPhone iSatisfaction iFantastic

"In one of the first such studies, 90% of 200 owners said they were "extremely" or "very" satisfied with their phone. And 85% said they are "extremely" or "very" likely to recommend the device to others, says the online survey conducted and paid for by market researcher Interpret of Santa Monica, Calif. The firm surveyed 1,000 cellphone users July 6-10."

USA Today is reporting on a survey of iPhone users and satisfaction is remarkably high. While I wouldn’t put too much weight in this given that the device has been in consumer’s hands for a week and based on the high cost and fashion appeal of the device, well users look past the small things that more mature market participants get knocked on. In other words, it’s still in the honeymoon phase with users.

The survey does point to some interesting data points, such as half of the survey group being AT&T customers before they purchased the iPhone. Depending on your perspective, this is either high or it’s low… I would have expected the number to be lower given the massive PR halo around the iPhone and consumers switching carriers at higher numbers to get it.

Also interesting, at least I found it so, is that 4-in-10 buyers had no previously owned an iPod. Either this represents a large untapped market for the iPod and the crossover appeal is in fact have the desired impact, ooorrrr, the fact that 60% of the buyers are already iPod users (and presumably iTunes subscribers) then the bottom line for Apple in terms of media subs is lower than expected.

Keep in mind that Apple’s business here is twofold, they are obviously selling hardware but equally interested in seeing that hardware drive related business units, in this case iTunes downloads.

One thing is clear in this survey, Apple is getting new customers on the Apple brand with 30% of the survey group not previously owning an Apple product.

I should also point out that while the online survey reached 1,000 cellphone users, only 200 were iPhone users so the sample group is pretty small considering over 1 million devices have shipped.

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The Consequences of Biofuels From Food

Achieving the 15 percent [domestic fuel] goal would require the entire current U.S. corn crop, which represents a whopping 40 percent of the world’s corn supply. This would do more than create mere market distortions; the irresistible pressure to divert corn from food to fuel would create unprecedented turmoil.
- Henry I. Miller, Hoover Institution

It’s quite remarkable that members of Congress seem oblivious to not only the technology behind ethanol, but also the simple economic principles that commodity markets operate on. Subsidizing ethanol production creates an economic incentive for farmers to divert corn from food stock to fuel stock and the consequences are real.

Until the recent ethanol boom, more than 60 percent of the annual U.S. corn harvest was fed domestically to cattle, hogs and chickens, or used in food or beverages. Thousands of food items contain corn or corn byproducts. A spokesman for one of California’s largest cattle ranches and feedlots noted that since the end of 2005, the company has experienced a 36 percent increase in the cost of feed, "which translates to an additional expense of $101 per head raised."

Ironically, part of the inflation in food, 3.9% in April, is due to higher transportation costs but without a doubt the rise in corn prices is being driven by Congressional actions in the area of biofuel. This is not to suggest that biofuel is not something that deserves this attention, but to subsidize domestic ethanol while imposing a tariff on imported ethanol and ignoring the basic science of corn-based ethanol, which gets pimped and protected because of a powerful lobby and a powerful congressional delegation from corn producing states is self defeating:

State: Senator (affiliation and related Senate committess)

Iowa: Senators Harkin (D – Agriculture, Appropriations) and Grassley (R – Agriculture)

Illinois: Senators Durdin (D – Appropriations) and Obama (D)

Nebraska: Senators Nelson (D – Agriculture, Appropriations) and Hagel (R)

It’s no surprise that we are seeing a gorging on corn-based ethanol to the exclusion of other fuel stocks, regardless of the fact that corn has less energy than competing sources and costs more energy to produce.

While I’m optimistic about cellolosic ethanol (switch grass) the reality is that this is a technology that needs to further develop and then have infrastructure built to deliver it. The actions of Congress that are leading to the current gorging on corn ethanol are going to have consequences sooner rather than later  and then there will be another reactive grab bag of legislation that will create even more problems.

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