According to All Things Digital's Peter Kafka, Apple has been trying to convince programmerrs to make their shows available as part of a subscription, available via iTunes. The monthly price would be around $30, he reports.

We've heard these rumors before--but that doesn't mean they're not true. And the approach makes sense. It would give consumers more of what they really want--a lower bill, anywhere access, without having to buy another gizmo.

It also fixes some problems with Apple's current TV plans. It's clear, by Steve Jobs' own admission, that the company's Apple TV device is mostly for hobbyists. The products tepid sales may be less a reflection of the product's quality, than of the simple fact that most humans conceive of TV as a service--something that is simply delivered into their homes, not something they have to buy, set-up and repair. It's no surprise that Apple tried this approach first; it's the ultimate "product company," filled with employees (and a CEO) that like coming to work to great some neat new object of desire. But unlike other forms of media (music fans, for instance, have long purchased their music in the form of a product such as a vinyl album, CD or digital download), TV viewers have always paid that monthly cable or satellite bill (or received terrestrial broadcast TV service for free).

The new subscription approach also fits with what's happening in the world. Technologically, it fits with the rapid rise of digital streaming, in which a consumer views a piece of content that resides out on the Internet, as opposed to having to store a copy of that content on the hard drive in their PC, iPod or iPhone. So long as the content can be delivered in this manner glitch-free, streamed content fits better with how many people want to get their digital video: on whatever screen is most convenient. While the Apple TV might appeal to people that are fixated on watching Web-fare on their big screen TV, more people I know are far more interested in getting TV content, and any other kind of content, onto their laptop, PC or smartphone.

No company is as well positioned to satisfy this demand than Apple. Many carriers have plans to make their content available in more numerous, and interesting ways. Microsoft continues to push its "Three Screens and a Cloud" vision. But only Apple has iTunes. Hundreds of millions of people have tthis program installed on their PCs, Macs, iPods and iPhones, and more than 75 million have an ongoing billing relationship with the online store by the same name. Rather than any one product, it seems to me Apple's greatest imperative should be maintaining iTunes' role in these consumers' lives. The Apple TV may never be a hit. But consumers that decide to get their TV via iTunes rather than their current provider will be much more likely to buy new Apple products down the road. Certainly, many would consider a device for watching TV that is more portable than a MacBook, but larger than an iPhone. A tablet device, for example.

All of this remains conjecture, and assumes that Apple iTunes chief Eddy Cue can land the necessary content deals. It won't be easy, since these partners will be loath to cross their current distributors. But don't count Cue out. I wrote about him in the magazine recently, and my sources all say he's an immensely talented negotiator, that has pulled off many deals that looked impossible.

Such was the case when Apple first got studios to sell downloads via iTunes in 2005. After Jobs won over Disney, Cue wooed many of the others, says one former Apple manager. “Once a deal is worked out with a leader in a particular deal--in this case Disney--Eddy's great at convincing the others that they better get on the bandwagon." He does it with charm, rather than threats, says the source. "He's a schmoozer in the grand style--in a good way. Most of the people he deals with think of him as a close personal friend."

The classic complaint about Google Voice is that you have to start with a new number, and then pass that number around to everyone who's likely to call you in order for it to be effective. That presents a mild annoyance. If someone is accustomed to calling your cell phone number all the time, they just keep calling it and when they leave messages, they go not to Google Voice, where they get transcribed and forwarded to your email address and stored indefinitely. Rather these messages go to your wireless carrier's voice mail system where they're stored for a limited time, hard to get at, impossible to forward or share, and never transcribed.

As part of the rollout of the new features I noticed something very interesting on my Google Voice account. I noticed that the two mobile phones attached to my Google Voice account, one a Blackberry on Verizon, the other an iPhone on AT&T, had a new setting: "Activate Google voicemail for this phone." I clicked it and was given instructions on phone number to dial that began with *71. Essentially what I think it does is tell your wireless carrier to forward an unanswered call to Google Voice, essentially bypassing the carrier's voice mail system.

That means people call and leave messages on my mobile number will get transferred to Google Voice. And because those messages go straight to my email address, I'm more likely to respond to them quickly, or to return the call, and I can effectively forget about the passcode to get into my mobile voice mail account.

And if you're an iPhone user and a Google Voice customer, you can more closely integrate the two products into a more seamless experience, whether or not Apple ever gets around to approving the Google Voice application for the iPhone.

What's still missing from Google Voice is number portability for land lines. I would really like to transfer my home telephone number to Google Voice, and stop paying the exorbitant fees to Verizon for a phone I rarely use. I'd get rid of it entirely except for the fact that its in the 212 area code, for New Yorkers, losing a 212 number is, as I once wrote, like giving away a pet. Services like RingCentral, which I reviewed in the magazine over the summer, and Vonage allow number portability. Why not Google Voice?

During the entire conversation he took the opportunity to charge his iPhone, and after we had wrapped up the interview someone asked him what his favorite app is.

For the record, the chairman's favorite iPhone app is Vito Technology's Star Walk, a simple astronomy application that harnesses the iPhone's GPS capabilities to present an on-screen view of what stars and constellations should be visible on a clear night from your current location. He said he's recently been introducing his 5-year old daughter to the pleasures of stargazing, and that the application has been useful in explaining what they're seeing in the night sky. As you move the phone right and left or up and down, the view of the sky shown on the phone moves with you. It also contains links to Wikipedia articles about celestial bodies like planets and nebulae and it contains information on the phases of the moon. (Image below from Appcraver.)

Broken Promises

Teeter Totter

PC News

Microsoft, of course, had it's own ads related to its launch. Here's a sample:

My Idea TV Commercial - Collaboration.

My Idea TV Commercial - Jack’s Snap

Personally, I think Apple wins this inning of this ongoing marketing war, in a big way. Apple's ads play on a reality that millions--make that hundreds of millions--of people recognize: that despite promises with each new release of Windows, people's PCs still run into plenty of maddening problems. Of course, using a Mac isn't a guaranteed one-way ticket to computing nirvana. But then, Apple has only to convince people to try something new. The ads make the case in a compelling way.

As for the Microsoft ads, I think they're just a tad abstract for the job at hand. First off, the greatest leap forward with Windows 7 is that it's better at the basic blocking and tackling--not fantabulous new features and capabilities. As such, I don't think the "ideas" being highlighted will move too many couch potatoes to go order a new PC.

More to the point, I think Microsoft missed an opportunity to turn a negative into a positive. The reality in the marketplace is that millions of people who have not wanted to buy Windows Vista are looking for reasons to go buy Windows 7. The company should have found a funny, humble way to poke fun at itself--to admit that, yes, Windows 7 is better than its predecessor, and that nobody is happier that the Vista era is over than Microsoft itself.

The patents in question, it says are fundamental to making devices like the iPhone compatible with certain wireless network standards including GSM, the network technology behind AT&T Wireless and other networks on which the iPhone operates around the world, as well as wireless LAN technologies, which means Wi-Fi, and UMTS.

Nokia's complaint -- which I haven't read in full yet -- apparently is based upon the principle that when companies contribute their intellectual property to industry standards they need to get compensated for it. Nokia's press release quotes Ilkka Rahnasto, Vice President, Legal & Intellectual Property as saying that "By refusing to agree appropriate terms for Nokia's intellectual property, Apple is attempting to get a free ride on the back of Nokia's innovation." Nokia says the patents have been infringed by all Apple iPhones shipped since 2007.

The case has been filed in the Federal District Court in Delaware, and as soon as I have a copy of the complaint, I'll post it here. The press release is here.

Update:As promised here's a copy of Nokia's complaint which I uploaded to Scribd. It's also embedded below.

An Apple spokesman declined to comment citing the company's policy of not commenting on pending litigation.

Nokia vs Apple - Complaint

So where does this put Apple in terms of overall value, versus some other leading tech companies? Here's a quick look:

Microsoft -- $236 billion
Apple -- $183 billion
Google -- $176 billion
IBM -- $162 billion
Cisco -- $140 billion
HP -- $115 billion
Oracle -- $111 billion
Dell -- $30 billion

This of course reminds me to remind you that you too can leave comments in your own voice via the Google Voice widget at the top right of this page. Just click it once and enter your phone number, pick it up when it rings, and wait for Google Voice to answer, and then leave a message. (A few people who call in seem to get confused by the process.)

As always we promise not to share your phone number so long as you're cool with us using your voice here. That is unless you tell us specifically not to in your message.

As my colleague Olga Kharif points out next door on Tech Beat, Craig Moffett of Sanford Bernstein thinks these ads may be a sign that talks may have broken down between Apple and Verizon over CDMA version of the iPhone. He wonders if this may also be Verizon's way of ratcheting up the pressure on Apple. Or maybe Verizon has walked away from the iPhone entirely. That would likely be good news for AT&T, rumored to be nearing the end of its agreement to carry the iPhone exclusively in the US.

Here's the rundown:

The MacBook has been redesigned with a new polycarbonate shell, which has a unibody design similar to that of the Aluminum unibody found on the MacBook Pro. It has a new look, with rounded edges, has a seven-hour battery that's built in, just like on the MacBook Pro. It also has an LED screen, which gives the entire Apple notebook line backlit LED-based displays, which I think is new. Its microprocessor is an Intel Core 2 Duo at 2.26 GHz and hard drive space starts at 250GB. Price: Still $999.

The iMac is getting a major face lift. It too has LED-based displays of sizes of 21.5 inches and an impressive 27-inches. In fact the only non-LED based display in Apple's line-up is the 30-inch LCD screen still offered. Apple VP Phil Schiller told me last night that getting an LED screen of that size is no small feat, so don't expect an LED replacement right away.

The 21.5-inch model is a classic consumer design, sporting chips from Intel running at 3.06 GHz and 3.33 GHz. It will sport Intel Core 2 Duos at speeds of 3.06 GHZ and 3.33 GHz. Graphics options include the Nvidia GeForce 9400M or the ATI Radeon 4670. There's support for up to 16 GB of RAM, and up to 2 terabytes of hard drive capacity. The starting price ranges: $1,199 to $1,499.

The 27-inch model is something else entirely. It's aimed at the professional who might otherwise buy a Mac Pro, but who wants an iMac, because they look better. I saw the screen on this monster last night and it's really impressive in person. It starts at $1,699, but there's another model that has a quad-core Intel Core i5 chip, that starts at $1,999, and which won't ship until November.

The entire iMac line will ship with a new mouse, dubbed Magic Mouse that replicates the multi-touch surface found on Apple notebooks, and which supports the same two-finger gesture movements for scrolling up and down and for moving back and forth between Web pages. Both iMac models will also have slots for SD cards, typically used in digital cameras. I generally wasn't crazy on the whole multi-touch touchpad thing on notebooks, that is until I bought a MacBook Pro over the summer.

While I still tend to use a traditional two-button mouse more often than not, I like the touchpad a lot more than I ever expected to and use it more often than before. So if you like that touchpad, and even if you like a two-button mouse, then you're going to love the Magic Mouse, because it gives you the best aspects of both. You can make the same two-finger gestures for scrolling and snapping back and forth between pages, but also, you can configure the mouse to recognize the "right click" found on a traditional mouse, as the click toward the right side of the mouse. Yes it looks a little weird when you first see it -- its very thin and smooth -- but I think it's going to be very popular. Also, both the Magic Mouse, and the default keyboard that ship with the iMac are wireless.

Finally, the Mac Mini, much loved, but always rumored to be due for retirement, got some love today too. The new entry-level Mini still sells for $599 and sports a new 2.26 GHz Intel Core 2 Duo chip, an Nvidia Geforce 9400M graphics card and a 160-gigabyte hard drive. A second model priced at $799 boosts the performance on the Intel chip to 2.53 GHz and the hard drive space to 320 GB.

As many probably already know, it turns out that many Mac Mini owners use their machines as inexpensive servers. Seeing an opportunity -- Apple's Xserve professional server line starts at $2,999 – Apple has launched a Mac Mini server for $999. The target Schiller says is small businesses for whom an XServe would be too expensive, as well as enthusiast consumers looking for an inexpensive, small-footprint media server server to share files around the house. The server has the same dimensions as the traditional Mac Mini, and supports storage capacity as high as One terabyte, but lacks an optical drive. It ships with a server version of Apple's Snow Leopard operating system.

But maybe the most important message was in CFO Peter Oppenheimer's comments on the topic of pricing. While Apple has made noises about getting more aggressive in the past, so far the move down market has been very limited. It sells that old white MacBook for $999, for example. But Oppenheimer repeatedly said that the company planned to deliver "greater value to consumers" in the quarters ahead. He cited lower ASPs (average selling prices) as a reason why those record gross margins will come down from 34% to more like 30% in the current quarter. And COO Tim Cook talked about "closing the umbrella," so that rivals with lesser products couldn't steal business simply by offering lower pricetags.

So what does this mean? It's possible prices for existing products may not come down much, but that the company will simply bring out new products with lower ASPs. Clearly, that could include the much-rumored iTablet--though my sources don't expect that until 2010. Or maybe there's a mystery product the rumor sites haven't caught wind of yet. Or maybe Apple plans to lower that old white MacBook to $900 or come out with a sub-$1000 iMac -- moves that Sanford Bernstein analyst Toni Sacconaghi thinks could expand Apple's available market for portable PCs by 50%.

Either way, it's bad news for PC rivals looking for a means to stem Apple's market share gains. And it's probably bad news for me in a more limited way, since I bet my boss Peter Elstrom a dinner that Apple wouldn't significantly slash prices. Peter figured the time was right, given the still tough economy and Apple's desire to take the steam out of Microsoft's Windows launch. We should know the winner soon enough.

Apple reported revenue of $9.87 billion, and a profit of $1.67 billion or $1.82 per share.

The results bested the estimates of analysts, many of whom had worried that rumored shortages of a key component for the iPhone might have affected sales of the popular wireless device. The consensus estimate of Wall Street analysts had called for Apple to report per-share earnings of $1.42 on sales of $9.2 billion.

Apple's stock began trading up substantially -- by more than $13 or more than 7% -- in after-hours trading as the results were reported. The stock finished the regular trading session higher at $189.96, up $1.81 or nearly 1% after opening at $187.84. The stock has been flirting with the $200-per share mark, a level not seen in nearly two years. On Oct. 15 Apple stock hit a 52-week high of $192.32, less than 6% off its all-time high of $202.96 set on Dec. 27, 2007.

Apple set an all-time single-quarter sales record with its Macintosh computers, selling 3.05 million, accounting for $3.95 billion, or 40% of sales. Apple finished the year just short of the 13 million unit mark for the fiscal year, an improvement over the prior year of nearly 3.3 million units.

IPhone unit sales also set a quarterly record or 7.4 million units, amounting to a year-on-year improvement of nearly 7%. IPhone sales broke the 20-million unit mark for the fiscal year.

IPod sales declined slightly year-on-year to 10.177 million, down from 11.05 million, and also down sequentially from 10.215 million from the third quarter.

Apple finishes its fiscal year 2009 with sales of $36.5 billion, up more than 12% from fiscal 2008, and per-share profit for the year $6.29, beating the consensus estimate by 41 cents.

Wu raised his estimates on Apple about two weeks ago, and says estimates of other analysts are now catching up to his. He's expecting revenue to come in at $9.1 billion, and per-share earnings of $1.41. He thinks "there is still room for potential upside on higher consensus numbers," but says his main concern "high expectations where the upside may not be enough to satisfy near-term bullish sentiment."

On place to watch for some of that upside, he says, will be on gross margin. Apple has guided for 35% gross margins this quarter. Wu is expecting 35.2%. A recent refresh to Apple's iPod line, combined with the release of Snow Leopard and the iPhone 3GS will offset higher component costs and and recent price cuts on the Mac.

Wu is expecting what he calls "vintage conservative" guidance from Apple for the holiday quarter. He's expecting revenue to his $12.1 billion, and EPS of $2.02, higher than the consensus view of $11.5 billion and $1.91.

So what's it all mean for the stock? Expect some volatility in the near term, Wu says. He suggests buying on any weakness. The stock is trading just shy of $189 as of 12:30 today. Wu sees the stock going to $214 based on a valuation estimate of 18x Apple's 2010 estimated free cash flow, plus the $34 billion in net cash.

Finally, Wu seeks to puncture concerns about iPhone component supply problems that have been raised in recent days by Gene Munster of Piper Jaffray and Yair Renner of Oppenheimer, calling these concerns "noise."

Wu writes: "In our industry and supply chain checks, availability of key components .... is tighter but still good and not impacting production from what we can tell. We would argue the only valid constraints are demand and/or carrier relationships. Should there be constraints, we believe they are artificial."

Another analyst sounding the "high expectations" warning is Bill Fearnley of FTN Equity Markets, who released his monthly survey of Apple consumer resellers today. More on that after the jump.

IPod sales are above plan too, given the new iPod nano, and some pent-up demand heading into the September refresh. He remains concerned about a the rumored iPhone component shortages.

Fearnley raised his EPS estimate by four cents to $1.54 per share and boosted his revenue estimate to $9.45 billion, up slightly from $9.41 billion. He also raised is EPS estimate for Apple's fiscal 2010 to $7.26.

He says Apple will have a more competitive October as Windows 7 hits the streets, and Microsoft goes on the advertising offensive heading into the holidays. Additionally more PC companies will be pushing thin-and-light notebooks that will be seen as more competitive with Macs.

Finally, Fearnley looks at the iPhone component supply question and makes a few points. First, that Apple's carrier partners like AT&T had no issue keeping iPhones in stock in September. However contacts at "Apple's largest CE retail partner," again a not-so-veiled reference to Best Buy, reported "difficulty keeping iPhones in stock," during August and early September, but that inventory improved in early October.

He then turns his attention to the inventory of MacBook Pros, saying 8% of his survey contacts reported shortages in September. "Our research suggests there were few inventory shortages from Apple direct, both through the stores and at Apple.com. However, multiple contacts at regional, independent and leading CE chain locations reported spot shortages of both the 15-inch and 17-inch MacBook Pro models in September." IMacs were going in short supply too, during that period. In both cases, he writes, Apple may be trimming its channel inventory ahead of a product refresh.

Also, the firm did a cost-benefit analysis on whether Apple should not only end exclusivity in the US, but also spend the money to develop and support a version of the iPhone that runs on the CDMA network technology used by market giant Verizon (which doesn't support the current iPhone, which works on GSM technology). While Apple would lose around $50 in subsidy per phone (just 10% of the total subsidy--so not a huge haircut) and incur around $25 in extra development costs per phone, these would be a small price relative to the increase in overall sales, Piper argues.

The big loser, not surprisingly given AT&T's network woes, would be Ma Bell. Piper assumes that the carrier's iPhone sales would plummet by three million, or 27%, from current sales projections if customers could get their iPhones elsewhere. But GSM shop T-Mobile would sell one million, and CDMA shops Verizon and Sprint would sell 4.6 million. The overall sales bump would be a huge 24%, making it relatively easy for Apple to forget the better economics of its exclusive arrangement with AT&T. "With 35% of AT&T's iPhone sales coming from new customers, we feel it is reasonable to assume the company's total iPhone sales could decline by 30% or more and that Verizon could pick up the bulk of this lost share (why switch to AT&T for iPhone if you haven't left by now and the device is available through your carrier; Verizon's network quality could be a reasoon to switch from AT&T)," writes Piper analyst Christopher Larsen.

More broadly, Larsen makes a very big claim that says as much about Apple's strength in smart phones, as it does about the relative weakness of everyone else. "Although the iPhone is a strong player in the smartphone market, expanding its multi-vendor strategy could allow it to dominate the industry, as it does with the iPod."

What do you think?

He writes that Apple could report revenues that are inline with the $9.2 billion consensus estimate of analysts, or "slightly disappointing." He suggests keeping some money handy to buy some share on a pullback on the price he says may occur immediately after the earnings release hits the wires.

What's the trouble? Yes, iPhone unit sales are thought to be ahead of many estimates, including his own guess of 6 million units, but troubles with component supply "may have prevented Apple from fully meeting demand" in the quarter, he writes.

A short-term drop ahead of a "potentially gargantuan December quarter for the iPhone" plus better Mac sales, and the expected early-2010 announcement of the long-rumored tablet device all add up to a buying opportunity, Renner says. More after the jump.

Next he says that more recent checks suggest the supply constraints have been solved. But it's difficult to assess when the bottleneck was fixed, and thus tricky to guess how many more iPhones were sold during the quarter. He thinks the consensus estimate that Apple shipped another 3.5 million may turn out to be too aggressive.

With demand still strong, and supply problems seemingly solved, December could turn out to be, he writes, "a substantial catch-up month," and that his prior assumption that Apple will sell 8 million units during the holiday period, he writes, could prove conservative, especially given the expanding universe of wireless carriers who offer the iPhone around the world.

Renner is a little less bullish on Mac sales. He thinks unit sales should come inline with the consensus estimates in the 2.7 to 2.8 million range, and that there's little potential for upside there. The reason: Consistent rumor chatter about new Macs and and MacBooks will have caused some people who might have bought a Mac during the September quarter to hold off and wait for an expected refresh in the December quarter. But he says Mac sales growth in the December quarter will be impressive.

Finally Renner says he expects Apple to "significantly outpace" estimates on its gross margin. A higher sales mix in favor of the iPhone and strong software sales will put some serious fuel in the tank, he says. Gross margin, a key measure of a company's profitability, was 36.3% last quarter, and 34.7% a year ago. He estimates it at 37.3%, but says it could go even higher.

Munster writes that retail sales research firm NPD is showing Apple unit sales tracking above the consensus estimates of Wall Street analysts. Domestic Mac sales for July and August show growth of 7%, which he says implies overall Mac sales of 2.8 million units.

On the iPhone side of the business Munster says checks of Apple's supply chain are showing that production constraints on the iPhone 3GS suggest that demand is so high for the phone worldwide that Apple and its manufacturing partners can't seem to make them fast enough. This implies, he says, sales of about 7.5 million units in the quarter. He cites comments by the CEO of Italian wireless carrier 3 Italia, saying the company is selling 20,000 iPhones per month, but could sell twice as many given adequate supply.

For the quarter he expects Apple to report per-share earnings of $1.37 on sales of $9.1 billion, boosting his estimate from an EPS of $1.24 on sales of $8.9 billion. He expects gross margins to hit 36%, up from 34.5%.

Looking ahead to the all-important holiday quarter, ending in December, Munster expects Apple do what it always does: Issue conservative guidance. Over the last 12 quarters, he reminds that Apple has given revenue guidance that averages about 4% below the consensus estimate, and for EPS that is 12% below the consensus. But actual results always beat the consensus by an average of 3%, and by a whopping 24% on the EPS.

What will be especially interesting however is how Apple's guidance is affected by the change in certain accounting rules by the Financial Accounting Standards Board that will affect both the iPhone and AppleTV business segments. More on this after the jump...

Since Apple has been issuing software updates during the two-year life of each iPhone or AppleTV box, the accounting treatment of that revenue has helped cover the costs incurred from issuing software updates, which it does regularly. This is one of the reasons that major iPhone OS updates aren't free for iPod touch owners.

The benefit is that the deferred revenue created a stable annuity-like stream of income that would insulate Apple against the more volatile movements of the PC market. (Though in Apple's case, that movement has been steadily upward in recent years, and less subject to the ups and downs with which the other PC companies struggle.) But it also created this oddly skewed picture of Apple's operations.

The company went to great lengths to report its GAAP results, which took the subscription rule into account, and then to report its non-GAAP results, which showed what Apple would have been reporting were it not for this rule, and the difference between them was impressive. It was such an important matter, that when Apple took the unusual step of having CEO Steve Jobs speak on a earnings conference call to explain it all, which is something he rarely does.

The argument about subscription accounting goes like this: If you offer free upgrades over a specified time on a device like an iPhone, the FASB required you to treat the product like a subscription for accounting purposes, and then defer the revenue from the up-front sale over the time of that "subscription."

But the case can be made most of the value you get from an iPhone, you get right away at the time of the purchase. Under the new rules, Apple will be able to decide how much of that value is realized at the time of purchase, and then book revenue accordingly. So if you derive 90% of the value of the iPhone when you first buy it, then only 10% of the revenue gets deferred. It's not clear how Apple is going to treat each product, but the rules are now much more flexible.

On Sept. 23, the FASB announced changes to its rules that let the company decide how much of its revenue from the sale of a product gets deferred. It's not clear how Apple is going to execute this change, but you can expect some time time to be spent on the conference call going over the intricacies.

In a note on Sept. 24, Munster discussed the implications for this change, which he expects Apple to implement into its accounting during the December quarter, which is Apple's first fiscal quarter for 2010.

What it means is that Apple's earnings, will on paper, appear to soar. For Apple's fiscal year 2009, the company would with the change in place, have Apple reporting $8.21 per-share earnings on a GAAP basis instead of the previously expected $5.71. And for fiscal 2010, he expects Apple's GAAP earnings to go from $6 per share to $8.90.

Under the previous rules, he says, Apple would report a difference of about 35% between its GAAP and non-GAAP results. With the new rule in place, he expects that difference to narrow to 5% or less. It's notable that in that same research note Munster raised his price target on Apple from $186 a share to $235.