Analyst: Apple may enter subscription biz
updated 02:50 pm EDT, Thu April 26, 2007
Apple in subscription biz?
Apple may enter the subscription services business in the future with one stop shop for music, TV, movie, and video game content, according to American Technology Research senior analyst Shaw Wu. "Apple again showed its unparalleled ability to think and execute the unconventional," the analyst wrote in a research note obtained by MacNN. "In our analysis, we envision Apple entering the subscription services business in a bigger way with music, TV, movie, and video game content truly becoming the only vertically integrated play and one stop shop for hardware, software, and services for the digital lifestyle." American Technology Research maintained its 'buy' rating on Apple shares with a $145 price target.
Wu also pointed to three surprises revealed in the Cupertino-based company's March quarter report, namely its ability to capitalize in a favorable component pricing environment, strong Mac shipments despite evidence of pent-up demand ahead of Leopard's launch, and larger plans with the iPhone and Apple TV.
"While there could be near-term confusion and concern with its new accounting treatment where fiscal year 2008 estimates will likely be reduced modestly, at the end of the day, there is no impact to cash flow (as Apple collects full cash at the point of sale) and we believe longer-term, Apple's financial predictability improves with more recurring revenue," said Wu. "In addition, we believe Apple's surprising use of subscription accounting for iPhone and Apple TV is a sign of things to come."
Fresh-Faced Recruit
Joined: Apr 2005
Uhm, wha?
I guess Shaw and ATR haven't seen the quote from Jobs just the other day where he says subscription weren't likely to happen. Steve doesn't like them, and he will avoid them as long as humanly possible. It was in fact noted in an earlier article today here on MacNN. Yet these analysts seem convinced it's gonna happen anyway. Whatever.