Q: Can you speak to details of guidance for March quarter?
A: We can't go into that. We're shipping great products and our customers are responding.
Q: Can you talk about adding Wal-Mart as iPhone distribution point?
A: We just started with them at the very end of December, so we don't have enough data to draw any conclusions on performance. Wal-Mart gives us a much broader reach beyond what we and AT&T can provide. They were already selling iPods, and we were pleased with that relationship.
Q: Can you talk about linearity in Mac and iPhone sales?
A: Mac sales second-highest in history. New portable announcement drove huge sales and resulted in the stunning 34% growth in that segment given the overall market. Overall, international performance better than US. iPhone doesn't have much history, so hard to say, but we're pleased with the performance.
Q: Is there a different retail store philosophy for international vs. domestic?
A: International retail performance was a bit stronger than in US. We think the retail stores help us in each of our locations. We just want to be sure that the Macs and iPhones have a great place for customers to experience them.
Q: How have dynamics of discounting to third-party retailers like Best Buy and Wal-Mart affected you?
A: Retailers are free to do what they want. Around the holidays we saw some attaching promos like gift cards to purchases, and that's fine with us.
Q: There are other iPhone competitors coming to the market: Android, Palm Pre. How do you think about sustaining leadership in the face of these competitors?
A: It's difficult to compare to products that are not yet in the market. iPhone has seen terrific rating from customers. Software is the key ingredient, and we believe that we are years ahead of our competitors. Having different screen sizes, different input methods, and different hardware makes things difficult for developers. We view iPhone as primarily a software platform, which is different from our competitors. We don't mind competition, but if others rip off our intellectual property, we will go after them.
Q: The Palm device seems to directly emulate the iPhone's innovative interface. Is that what you're referring to?
A: We don't want to refer to any specific companies, so that was a general statement. We like competition because it makes us better, but we will not stand for companies infringing on our IP.
Q: How many One-to-One sessions did you have at retail stores this quarter?
A: We don't have that number here, but we did set a record.
Q: How many of your 500 million App Store downloads were paid and how many were free?
A: That's not something we're prepared to disclose.
Q: Will you eventually separate out App Store sales results from iTunes Store sales?
A: The App Store is part of iTunes, and we have no plans to separate them.
