“As was widely expected, Apple got rid of the headphone jack on its iPhone 7 and subsequently announced a portfolio of new Beats wireless headphones. We noted last month that eliminating the headphone jack would accelerate a hardware revolution in the headphone market of which AAPL-owned Beats would likely be the biggest beneficiary,” L&F Capital Management writes for Seeking Alpha. “With the announcement now official, we have sized this market and believe the iPhone 7 presents a $5 billion opportunity for Beats.”

“We believe the iPhone 7 will sell at least as well, and likely better than, the iPhone 6s. The iPhone 8, which is rumored to have some major upgrades, also will likely sell well,” L&F Capital Management writes. “Buyers of both of these phones will be forced to use wireless or lightning-enabled headphones (if they want to listen to music), of which current trends suggest wireless will be the more popular by a significant margin.”

“About half of iPhone owners use their iPhone to listen to music, while most (around 80%) do not own a pair of wireless headphones, implying that around 40% of iPhone 7/8 buyers next year will be strongly inclined to buy a pair of wireless headphones. We estimate Beats owns 45% of the wireless headphone market, so that means 18% of iPhone 7/8 buyers are strongly inclined to buy a pair of Beats wireless headphones next year,” L&F Capital Management writes. “Conservatively assuming 140 million iPhone 7/8 models ship next year, that implies just around 25-26 million Beats wireless headphone shipments. At a $200 ASP, that is a $5 billion revenue opportunity for Beats related to iPhone 7/8 purchases.”

Read more in the full article here.

MacDailyNews Take: And how millions upon millions will also buy Apple’s revolutionary new AirPods with the new ultra-low power Apple W1 chip (also in the new Beats wireless headphones).

This is what you call a win-win situation for Apple and their customers who get higher quality sound, water- and dust-resistant devices, thinner, lighter devices, iPhones with stereo speakers, and the opportunity for future advanced (biometrics, etc.) that the 3.5mm anachronism simply could not offer.

By killing the 3.5mm headphone jack, Apple is doing something extraordinary for music sound quality – September 8, 2016
No headphone jack? No problem: How to listen to music while you sync and charge your new iPhone 7/Plus – September 8, 2016
Apple VP calls 3.5mm headphone jack ‘a dinosaur,’ says ‘it’s time to move on’ – September 8, 2016
Apple kills the headphone jack – September 7, 2016
Apple reinvents the wireless headphone with AirPods – September 7, 2016
Apple’s iPhone reveal: Death of antiquated 3.5mm headphone jack heightens anticipation – September 7, 2016