Apple shares take hit on Sony, Napster fears

“Apple Computer Inc. shares dropped Tuesday on concern a relaunch of Sony Corp.’s famed Walkman line and increased competition from Napster Inc. might take a bite out of its dominance of online music and portable players… it appears Apple for the first time might become bruised by some serious competition from both Sony and a host of online music providers led by Napster. Shares of Apple have dropped 8.5 percent since the announcement of the stock split on Feb. 11, and have tumbled some 6 percent this week alone,” AP Online reports via COMTEX.

“Sony hopes to regain some of its luster in an iPod-dominated market by expanding its Walkman line of digital music players. The new line will store files using flash memory, which is more lightweight and compact compared to the hard drive used by most MP3 players, including the traditional iPod,” AP reports. “The Sony players will retail for as low as $130 – a bit more expensive than the new iPod Shuffle, but considered to be a better buy because of a longer battery life and more features.”

“Meanwhile, on the content side, rival Napster recently boosted its sales outlook based on growing demand of its new “Napster To Go” subscription service. The Los Angeles-based company – which expects revenue of about $15 million for its fiscal fourth quarter – said consumers are flocking to its newly launched service that allows unlimited downloads for a flat fee… Shares of Apple fell $1.88, or 4.4 percent, to $40.87 in afternoon trade,” AP reports.

Full article here.

MacDailyNews Take: Buying opportunity knocks?

Related MacDailyNews articles:
Sony launches Apple iPod shuffle ‘killer’ – March 08, 2005
Should Apple add subscription service to iTunes? – March 07, 2005
Apple shares slip 5 percent after Napster boosts revenue outlook; Napster shares rise 8 percent – March 03, 2005

26 Comments

  1. Real is run by a gob of pond scum. Realplayer software by any definition is a virus and their business is based on scamming their customers.

    !Napster is the former Roxio, a non-starter and non-player in this business. They’re spending half their annual revenue on advertising this year and don’t expect to make a profit in the forseeable future. They have enough revenue and cash to last out the year. They’re simply trying to hype their stock price before they bail out, ala Enron.

    Why the financial community takes any of this hype by !Napster and Real seriously is beyond my understanding.

  2. I’m not too sure if the stock fallback is related to either Sony or Real.

    My bet is that the brokers have decided to take profits – I’m sure they get together and say let’s dump this stock.

    Fact is Apple are probably going to sell more iPods than last quarter and maybe even more macs.

    Might as well hang in till the end of the quarter.

  3. Apple stock is going on sale b/c of FUD. Sony has failed once (maybe twice already) and Napster is raising its outlook by only $1 million for the quarter, yet Apple makes that and then some in a day. Plus, demand for Apple’s tunes and pods have shown near exponential growth with no signs of letting up. I mean, come on, show me proof that Sony and Napster have bitten into the shiny Apple. This is nothing but pure speculation. Cleo must be working as an analyst.

  4. Buy now and wait for the sales figures of Mac minis and iPod Shuffles. It’ll jump back up again in no time and then some. A little further down the road, Tiger sales and resultant system sales will boost it even further. Tiger is going to rock.

    Wish I had a couple grand to drop on Apple stock…

  5. What the hay?! Such a wishy-washy bunch of Ficklers the other AAPL stockholders are….and every new iPod “killer” ends up exactly the same, sitting unsold on shelves and cursed at in frustration by the consumers unfortunate enough to be tricked into buying it. It sure as H.E.doublehockeysticks wasn’t me selling today….I’m holdin’! The iTunes/iPod/iTMS has been a huge boost, but it’s the computering hardware and Tiger that will put Apple through the roof this year.

  6. “a relaunch of Sony Corp.’s famed Walkman line”

    OK, it’s not a “relaunch” of the “walkman line”…it is many months into a line named walkman that has nothing to do with the “famed” walkmans…

    “it appears Apple for the first time might become bruised by some serious competition from both Sony and a host of online music providers led by Napster.”

    Uh, well, it’s obvious that Apple has to be mindful of competitors and that it’s unlikely they will remain as dominant for the “mp3”-player & download market as they are in this era. However, the competition from these companies really hasn’t become anymore serious than it was before. Oh, yeah, Napster had an 8% rise in revenue…at the same time Apple reported that iTunes sales were over double what they expected (don’t even know the percent growth). Sony is changing leadership and, wow, they might put out more overpriced HD and flash players that work with their universally panned download store…BUT they’re going to call it a walkman!

  7. it is obvious that everyone is trying their hardest to take a piece away from Apple. Napster is going on tour to promote their service (I’m not exactly sure what they expect to accomplish on tour). MacMinute reports that the new Sony PSP will be able to be used on PCs and Macs to upload music to it. Sony also introduced a Walkman cellphone capable of storing music. While none of these is going to displace Apple as the undisputed leader, each of these things will take a little away from Apple. Sony actually seems to have done the most recently to try to create alternatives to the iPod. Like Microsoft and unlike Real, or Creative, or Napster, Sony will have the ability to endure a slow start and could gradually pick up market share that could eventually rival Apple.

  8. “Best Buy reported triple-digit gains in MP3 player sales for its just recorded quarter”
    http://www.appleinsider.com/news.php?id=939
    hmmm, I doubt that’s coming from Creative. I think iPod sales for this recent quarter is going to be quite surprising. I guess I have to take back what i just said a minute ago. Apple is showing no signs of giving up any ground to the competitors.

  9. The press pendelum is starting to swing the other way…

    Watch for these type stories in press in the next few weeks:
    – Mini mac deliveries too slow: Has Apples missed the sizzle to sell this product?
    – Where´s the faster Power Macs?
    – Has the Power Book topped out with the G4? G5 just too hot!
    – Sales of iPods stalling! Competition is heating up!
    – Napster taking a bite out of Apple?
    – Something wrong with the mini mac?-People complain about poor color when hooking up to VGA monitors.
    – Child Swallows Shuttle – Parents Suing Apple “It looks just like a stick of Gum!”
    – Tiger Delayed…Coming after Longhorn?
    -Survey shows 98% of PC owners have no idea what a mac mini is!

    Why the negative stories coming? Steve went to court after the “journalists” for leaking the Apple “secret” documents to the rumor websites. Don´t mess with the Press!!!

  10. And don´t forget this one coming from the Newsguys and gals:
    The new Xbox from Microsoft will have a 3.0GHz PowerPC chip. The press will ask “Why is IBM giving faster chips to Microsoft than Apple???”

    “CPU will use three 3.0GHz PowerPC cores, each with 32KB L1 cache, 32KB instruction cache, and the three share 1MB of L2 cache. Later alpha decks only featured two cores.”
    http://www.engadget.com/entry/1234000600035065/

  11. The stock punters will take any excuse to cash in their profit. Any one who invests for long term should not be deterred. Beside, Apple’s stock has more than doubled in less than a year; a minor correction is not that significant. However, all the dead Mac bashers will come out of the woodwork from all directions to begin their assault every time there is a negative new about Apple!!!

  12. Excuse me.. but just because Investors are delusional, does not mean this is serious competition…

    Let’s see.. Sony throws milllions of dollars at failed projects and its stock goes UP?

    I don’t think so.. This is a bounce back, a nice hop, but by no means a trend..

    Furthermore, the Napster effect is just silly.. 14M in revenue per year or something, you’ve got to be joking..

    I’m picturing Gnats buzzing around a Tiger when I hear about Napster and RealNetworks

    Investors are still clueless..

    The source of Apple’s drop may just be a coincidence.. many investors feel the stock surge is in the past.. settling in at around 50 bucks..

    Oh well, wait until the marketshare numbers come in at the end of the quarter…

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