BloggingStocks: ‘Apple is a phenomenon’

Apple Store“Apple, Inc. took out a full page advertisement in today’s Wall Street Journal simply stating that 100 million iPod’s had been sold since the device’s inception,” Georges Yared writes for BloggingStocks. “The simple tagline reads ‘Thanks to music lovers everywhere.'”

“Apple is a phenomenon because of several profitable and still growing moving parts. The fact that Apple has sold its one hundred millionth iPod, and commands a dominating marketshare of 70% is itself phenomenal, but the market is still vastly under-penetrated. Many consumers are already on their 2nd and 3rd versions of the iPod. The number of individuals that have purchased the device is about 40 million ( Apple has been hesitant about giving out that specific number). When one considers the size and the scope of the market–world-wide– the penetration level of potential buyers is far, far away from saturation,” Yared writes.

“What is beautiful about the financial model for Apple is the recurring revenue theme. As consumers buy the iPod, a huge percentage of them then open an account with the iTunes store and the Apple cash register just keeps on ringing,” Yared writes.

Yared writes, “When the iPhone rolls out in June, Apple’s advantage is the massively happy installed base of customers. The missionary sales cycle will be by-passed on this product. The early adopters alone will drive huge incremental revenue… The new and improved Mac computer is another budding phenomenon within Apple. That, with improved CPU units, software enhancements and other product improvements gives Apple a multi-pronged approach to their revenue model… The phenomenon that has become Apple will continue for another 3-5 years.”

Full article here.


  1. M.A.D.

    3-5 years doesn’t mean that it’s over after 5. It only means that the analyst can see new products and revenue streams evolving over that time period. You can be sure that Apple will be developing new strategies, and you can also be sure that analysts won’t be aware of them until Apple has a head start on their competition, just as what happened with the iPod.

  2. > I think every iPod should come with a $5 or $10 gift card for iTunes.

    Seems unnecessary. Every iPod owner installs iTunes. Using the iTunes Store is a few clicks away. It’s not like customer has to have any more encouragement to buy songs, or any more advantage over the competition. If anything, there should be a $10 coupon with the video-capable iPod to use toward buying a movie or TV shows. That’s where Apple needs to encourage more sales.

  3. 5 years of exponential growth and you are complaining?

    Owning a significant and growing portion of the music player, cell phone, set top box and personal computer market and you are complaining.

    Buy APPL and STFU.

  4. It was a beautiful ad.

    Then I saw some article about some Sandisk, Yahoo and some other company’s iPod killer that allows one to purchase tracks wireless from this MP3 player they are introducing on Friday.

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