These are days for summing up. On Friday, we ended the first half of 2012, and also marked exactly five years since Apple (AAPL) started to sell the first iPhone, on Friday, June 29, 2007. Today, we know that Samsung immediately realized the power of the bomb that Steve Jobs dropped on the slumbering telephones market, and started to design iPhone lookalikes. By contrast, the company that led the market by a long way, Nokia (NOK), thought that this was another of Steve Jobs’s delusions of grandeur that would end in failure, and did nothing for over two years.

The result is that only Samsung stands today as a serious competitor to Apple. Nokia has collapsed to a market cap of $7.7 billion, less than the value at which Microsoft (MSFT) bought Skype last year. All that is left for Nokia to do is to “go to church and pray”, which is where they say Dov Moran sent them in 2008 because of his telephones. In retrospect, the recommendation was right, but because of the iPhone.

As far as the portfolio managed here is concerned, Apple’s huge success leaves a bitter-sweet taste. Sweet, because I brought Apple into the portfolio at $88 in March 2007, in the period between the unveiling of the first iPhone by Jobs and its commercial launch. Bitter, because I believed that the only person who said to me then that the iPhone was a huge revolution, Dr. Eli Harari, founder and at that time CEO of SanDisk Corporation (Nasdaq:SNDK), would succeed in translating his correct reading of the market into a bonanza for his company, and that has yet to happen.

As the second half of 2012 begins, I am fairly certain that Harari’s successor, Sanjay Mehrotra, has succeeded in getting SanDisk’s solutions into one or more of the new products that Apple will shortly launch…Read More>>

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