updated 10:40 am EST, Wed March 22, 2006
ATR on French law, Vista
American Technology Research (ATR) today commented on the new French draft law which threatens to open up iTunes to Apple's competitors, as well as Microsoft's decision to push back its Windows Vista operating system launch to January of 2007. "On the surface, this [draft law] appears negative for Apple, but we believe interoperability could ironically become a catalyst for driving more iPod units." Apple today responded to the French law, also proposing the possibility that its iPod sales could balloon as users freely load up their iPods with interoperable music, "which cannot be adequately protected." American Technology also believes that Apple has a superior product to other players, which will give the company an advantage should the French law pass the senate. "In our view, customers are attracted to Apple's ease-of-use, industrial design, iconic brand name, and competitive prices. Moreover, we do not believe Apple is that dependent on its iTunes music store as we estimate that about 2-3 dozen songs are purchased from iTunes over the life of each iPod, meaning most consumers get their music another way."
Responding to Microsoft's decision to delay its Vista operating system, ATR expects the move to hurt the software giant in the end.
"We believe near-term demand could benefit with buyers who were waiting buying current Windows XP systems now," the firm wrote. "However, we believe that in the second half of 2006, growth could become more muted as customers may 'pause' ahead of the Vista consumer launch in January 2007."
Additionally, the research firm believes that by delaying its operating system launch, Microsoft is giving Apple a head start.
"We believe the delay is positive for Apple, leaving it with less competition in 2006 in its Mac business."