Analyst: Sony, Napster will not impact Apple
updated 06:05 pm EST, Tue March 8, 2005
Apple vs. Sony vs. Napster
Despite new and Napster, Merrill Lynch maintained its 'Buy' rating on the stock, says that it does believe that either announcement will impact Apple. In a research report released today, analyst Steven Milunovich believes that Sony's new MP3 device will make it a "serious competitor," as they are priced similiarly to Apple's iPod shuffle line, but also offer a small LCD screen and battery life of up to 70 hours on AAA batteries. "We believe these are likely to be solid sellers, but they don't support iTunes and do not have the cache of an iPod....We view Sony as the most serious competitor, but since Apple will be supply-constrained on shuffle it will be difficult to assess the impact in the near term."
Earlier today, Napster CEO Chris Gorog said that he expects Napster to cut into Apple's dominant share of the digital music world with its $14.99 per month subscription service, but Milunovich believes that the subscription service would not be threat to Apple: "We don't see a big impact on Apple because (1) we are not big believers in the subscription model where consumers pay indefinitely to listen to their favorite songs, and (2) if we're wrong, Apple can establish a subscription service with few barriers to entry."
The report said that record label executives also believed that the market would begin to divide among the pay-per-song and subscription models, but that the Labels believed the majority of people would choose to purchase songs--leaving room a much smaller niche market for subscription services.
Concerns over Apple's dominance caused Apple shares to drop by more than 5 percent. However, Merrill reiterated its 'Buy' rating with a price target of $51 per share.
Fresh-Faced Recruit
Joined: Mar 2005
AH C'MMON PEOPLE!!
For Christ's sake, are most Apple investors that bloody stupid! The minute news of a Joe bloe opening up his own music store or offering their own MP3 player comes out...ooooh Apple has competition...run...C'MMON!! Don't you people have a gram of sense and logic!! Why would these competitors take away from Apple's dominance?? or rather HOW??? 80% of the digital market is OWNED by iPods and there is NO indication of it going down. NONE of these retarded competitors are iPod compatible! Now HOW will that compete. on that 10% c*** that plays .WMV and runs of AAA batteries, that end up costing you more than the device itself in one month?? THINK PEOPLE.
Unless Apple does absolutely NOTHING, then MAYBE its dominance will fade, and if so, ONLY in a few years. No one goes from 80% to nothing over night.
We all know that Apple will NOT sit still, and if there is any sign of threat it will retaliate. Also, and more importantly, every bloody investor seems to see Apple as 'the iPod and iTunes' only. While its true that its those two things that boosted Apple the most, you can't dismiss all the insanely new things the company is doing. Mac Mini anyone?? Hello???? anyone awake out there. The Mac Mini is the n2nd trojan horse into the PC world TRUST ME. Tiger!!! etc etc...Mac sales on the rise!, etc etc...and to top it all off...all analysts continue to increase their BUY ratings on Apple. At least theyre smart enough to see the real deal.
It's just sad to see the market react the way it does. It just shows the current Apple investor is one that lacks total long term vision and common sense. The right thing to do right now is BUY and HOLD...not SELL!!!!!