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Apple (NASDAQ:AAPL) suffered a major blow after a bug in its video calling application, FaceTime, was found to compromise user privacy.
Reportedly, when an iPhone user makes a call using FaceTime, the recipient’s audio and video, in some cases, can be accessed even before the call is answered.
Notably, the bug is activated when users use the group FaceTime feature on iOS devices with version 12.1 or later, per BBC. The bug first discovered by an iPhone user was later tested and confirmed by Bloomberg, CNBC and 9to5Mac to name a few.
Did FaceTime Fail to Live Up to Expectations?
Apple initially delayed the release of the group FaceTime feature after users faced some issues with its beta version. However, the delay failed to keep the feature trouble free.
Notably, the feature enables up to 32 people to participate in both audio and video calls. Additional features include live photo snaps and use of Apple’s Animoji.
Moreover, the issue, which was reported on Data Privacy Day, dealt a serious blow to the iPhone maker’s stance against user data negligence. Earlier, Apple had taken a dig at other major tech companies like Alphabet’s (NASDAQ:GOOGL) Google, Facebook (NASDAQ:FB) and Amazon (NASDAQ:AMZN) for their lack of stringent data privacy initiatives.
The bug might hurt Apple as users may choose other group video chat providers like Facebook’s WhatsApp, Messenger and Portal, Alphabet’s Google Hangout services and Microsoft’s (NASDAQ:MSFT) Skype.
However, Apple has acknowledged the bug and deactivated the group FaceTime feature. The company is expected to release a software update later this week to permanently fix the bug.
Apple Inc. Revenue (TTM)
Apple Inc. Revenue (TTM) | Apple Inc. Quote
Data Security Important for Services Growth
It is very important for Apple to keep its user data secure as it offers important services like Apple Pay, App store and AppleCare among others. Improved user data security is expected to drive user confidence, thereby boosting usage of Apple services. This is expected to aid Service revenue growth.
Notably, fourth-quarter fiscal 2018 Services revenues (15.9% of sales) increased 17% year over year to $9.98 billion. Moreover, the Zacks Consensus Estimate for first-quarter fiscal 2019 Service revenues is pegged at $10.8 billion, up 27.7% year over year.
As Apple’s Services has emerged as the company’s new cash cow, we believe that its growth will eventually boost the top line, which is estimated to be $84.1 billion for first-quarter fiscal 2019.
Apple currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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