“Standard & Poor’s Equity Research downgraded RealNetworks to ‘hold’ from ‘buy’ and lowered its target price to $6.50 from $8 after a news report that Microsoft is planning to launch a subscription online music service. ‘RealNetworks alluded to such plans during its recent analyst meeting, but the stock’s reaction today indicates to us that an entry by Microsoft is not already priced into the shares. We also think there is a good chance that Apple Computer and perhaps others will explore such offerings in the coming months,’ the research firm reasoned as RealNetworks’ shares tumbled,” Forbes reports.
Full article here.
MacDailyNews Note: Apple is currently down US$1.84 per share to $35.81 today.
MacDailyNews Take: If subscription services become popular enough, Apple could offer such a service rather quickly and easily, we believe. Currently, Apple’s iTunes Music Store’s market share continues to increase and Apple is smart to let others spend now to educate the public about the subscription concept before taking the market if it proves viable.
Related MacDailyNews articles:
Microsoft plans music subscription service, may allow conversion of Apple iTunes-purchased tracks – June 10, 2005
Report: Apple iTunes Music Store more popular than most peer-to-peer file sharing services – June 07, 2005
Apple’s iTunes Music Store passes 430 million downloads, market share increases to 82-percent in May – June 07, 2005
Merrill Lynch analyst: Apple could ‘flick the switch on a music subscription model’ – May 13, 2005