“Apple on Wednesday again showed its unparalleled ability to think and execute the unconventional, says American Technology Analyst Shaw Wu, who in a note to clients argued that earnings per share (EPS) may no longer be the best way to value the consumer electronics maker,” Prince McLean reports for AppleInsider.
McLean reports, “Wu, who maintains a $145 price target on shares of the Cupertino-based company, says there were “three notable surprises” in the firm’s March quarter report. Specifically, its ability to capitalize in a favorable component pricing environment, its strong Mac shipments despite evidence of a pause ahead of Leopard, and its grander plans with iPhone and Apple TV.”
“While the new accounting allows Apple to state only 1/8 of a [iPhone and Apple TV] hardware sale each quarter, over the longer-term, Wu believes it will improve the company’s linearity and his ability to predict future revenue streams. It may also be a sign of future initiatives on the subscription front,” McLean reports. “‘We believe Apple is in the midst of building a more serious effort in the subscription business where it could enter the ‘rental’ space with video games and music, TV, and movie content,’ he told clients. ‘We would not be surprised to see Apple compete with the likes of Netflix and Blockbuster in a bigger way.'”
Full article here.
I buy my music and rent my video.
What about my music video?
VIDEO GAMES?
There is no way Apple is going to RENT DVD’s of Xbox 360 and PS3 or Wii games. where in the WORLD is this guy getting this from???
Movie rentals…yeah thats possible cause u can do that electronicly, but not console games.
and renting video games for the Mac platform? not happening either..
The real reason for AppleTV.
nice.
I don’t need to own movies. seriously. Anyone else?
Re: John Gee
“I don’t need to own movies. seriously. Anyone else?”
Some of them yes. If I find a movie that I really enjoy I go ahead and buy it because I like to watch it again and again. Now if they had a subscription to watch any movie in the database for a set price a month including new releases I would definetly do it. But I still would own some of them like the classics.
I hear ya, Movie Man.
l bought Apollo 13, some others. My wife likes to buy all movies she loves. Dang, so far she wins (again)
The question is … $1.99 rental…or more for AppleTV. Even if it’s the same as in the store for rental, it’s still a good idea. (but if it works like NetFlix that’s really interesting)
Just so long as I can buy what I want.
I love my music and DVD collections!
What about my music video?
I’d probably go with own, for that one. In my mind, it’s different from a movie, in that, I’d watch it more often. A movie has a plot and such to follow, and music videos are more about the music, so it doesn’t “ruin” it to watch it more often (like listening to the song more often than you’d watch a movie).
Re: John Gee
Wives always win. I just can not say no to mine for some reason.
Like you said if it is like netflix, a flat rate for a month then I am in. If it is $1.99 for each download then I may use it on occasion. I would be more likely to use it if I paid $12 a month and got to download one or two at a time as many as I could a month. I typically watch about 4 or 5 a month now but when I had netflix I was up to 3 a week.
Just so long as I can buy what I want.
That’s also a good point. I don’t care what medium it is, if I really like it, I’ll probably want to own it.
No desire to OWN movies and other video. Especially in digital download form.
If Apple can provide a subscription service for their movies that is the same or less a month than a comparable Netflix DVD rental account, I will buy an Apple TV the next day.
Until then, I have no interest.
Movie Man, others
No kidding – that would be sweet. All for it.
it’s just that upstart of $299….but that’s OK. I’ll get there.
iTunes coupled with Apple TV will become the living-room media center, completely replacing the recevier, and various components.
1. CD player – already dead with iTunes
2. DVD player – Close, but not quite. Apple will soon deliver HD content on iTunes, along with movie rental abilities. Then the DVD player and HD DVD players will all be DOA.
3. Apple TV will allow selections of movies and TV shows from directly in the living-room. No longer is it iPod like in one-way communication, but can flow purchased content back to the iTunes libary.
4. The Audio receiver also dies in this model. iTunes delivers all the content (audio and video) and who listens to radio in their living-room anymore? No amp required because Apple will – in 2008 – deliver a powered Accustimass-like speaker system, or plug Apple TV into any powered speaker system and the solution is complete.
5. Lastly, games. Apple will deliver their own gaming platform that streams through Apple TV from iTunes on a PC or Mac. So no, Apple will not be offering PSIII or xBox games – ever.
‘new accounting’ reminds me of new math! LOL!
Glad that Apple has found an acceptable way to provide new features on its hardware without the stupidity of those tiny payments to satisfy a stupid law.
The other neat thing about this accounting manoeuvre is the way you’ll see their bottom line growing incrementally quarter by quarter as more and more of their new stuff gets bought. Even 1/8th of the sales of TV and iPhone will give an immense lift to the next quarter’s report. Then you’ll be able to watch that graph push to the sky as more and more people buy in.
Exciting times after the scare of the ’90s.!
Whatever AppleTV sales are now, they’ll really increase once you’re able to rent movies through your AppleTV while lying naked on the sofa.
And I’d like to be able to watch porn vids that are posted on Usenet through the AppleTV. That’s another way to increase AppleTV sales.
MUSIC: I think Apple has gotten it right so far. I like to buy, not subscribe to, my music. However, unlike MDN, I do not contend that subscription services are “against human nature” (comments from previous articles. Many have shown an interest in subscription services. But Jobs recent comments mean that its not likely to happen.
MOVIES: I personally have never understood why one would buy a movie. I watch it once and I’m done. The huge exception of couse was movies for my young children. They would watch the same movie over and over again. However, it is clear from the many comments that I’ve read before that many others do enjoy owning their movies. Since Itunes is already set up for sale, I can only hope that Jobs decides to add a rental/subscription service to Itunes. Depending on their pricing, I think they effectively bankrupt Netflix in no time.
GAMES: @emax said: “There is no way Apple is going to RENT DVD’s of Xbox 360 and PS3 or Wii games. where in the WORLD is this guy getting this from???” The article never said Apple would rent those games. I think that many can see how the Apple TV can be used to port games to ones TV. They wouldn’t be the same as the console games, but they could still become very addictive, cheap alternatives that would carve out a new niche.
If you have kids, then you buy videos. Anyone who doesn’t understand doesn’t have kids – they will watch a video dozens of times.
“[…] its strong Mac shipments despite evidence of a pause ahead of Leopard […]”
Uh, the Leopard announcement was after the end of the quarter, so it certainly wouldn’t have had any affect on those machines sold.
Whether it will or not is up for debate, certainly, but I don’t think an announcement made in mid-April had an effect on people buying up to March 31st. C’mon, analysts…
eMax
It’s already been leaked by a former EA exec going to PopCap that they plan to write games for the aTV product. I think people will buy these games and rent movies.
This will be a huge cash/revenue engine for AAPL, IMO.
In regards to music, I do think a subscription service can work side-by-side with a purchase service. I want to own my favorite music. But I wouldn’t mind renting music to determine whether or not it might become my favorite music.
On the back-end, one of the entertaining things about subscription services is that it’s micropayments in action. One of the reasons you have to dock your music player once a month is so that Napster or Real can track which songs you listen to so that they can pay the appropriate amount to the appropriate owner.
For example, let’s say the Micropayment rate is $0.001 per listen (ie, one-tenth of a cent). In one month, you listen to ten EMI songs, 100 Warner songs, and 75 Sony songs, Napster pays EMI one cent, pays Warner 10 cents, and pays Sony 7-and-a-half cents. Now, consider that you pay Napster $14.95 per month for the right to listen to that music and Napster has walked away with $14.76 of your money. And they did that each month. Of course, if you listen to more music, Napster gets less and the labels get more. But Napster comes up with a rate that probably keeps them in the black unless you have music playing 24/7 for an entire month.
Though, as I’ve said here and elsewhere, for a subscription service to work, it actually has to provide a service and I think Apple can really win if they do this. They have many of pieces together already.
For example, allow me to subscribe to Billboard’s Top 40, Radio & Record’s Top 20 college tracks, and DJ Wazzoo’s Club Domino iMix. This way, every week I’ll get that music. If something is not on that list, it will be removed. I can then take that music, mix it with some of my personal favorites in a playlist. Add in podcast subscriptions from the likes of ABC news and the Weather Channel and my iPod is up-to-date and ready for my morning commute.
Who needs a radio station anymore?