Apple’s biggest mistake under Tim Cook so far? Not buying Netflix

“Apple’s biggest mistake under CEO Tim Cook has been not acquiring Netflix, a strategist told CNBC on Friday,” Chloe Taylor reports for CNBC. “Speaking to CNBC’s ‘Squawk Box Europe,’ Daniel Ives, managing director of equity research at Wedbush, said Apple was currently facing its ‘darkest chapter’ since the iPhone era. “‘(But) we’re bullish on Apple’s services,’ he said. ‘The next few quarters will be an uphill battle, but we’re predicting a trillion-dollar market cap for Apple in 2019.'”

“In order to move into a new growth phase, Apple would have to invest in its services offering, Ives added,” Taylor reports. “‘You need content, you need fuel in that engine. They’re lacking original content and lacking video content, which is why we believe they’ll buy a large film studio in 2019,’ he told CNBC. ‘We’ve talked about potentially Sony, Lionsgate, A24 – a CBS or Viacom is potentially still on the table as well as a Netflix, as that’s the key to drive the services business… In my opinion, the biggest strategic mistake Apple has made since Cook took over is not buying Netflix. That was the deal that they needed to do because it comes down to content.'”

Read more in the full article here.

MacDailyNews Take: Horse hockey.

Until Apple actually buys Netflix, we’ll keep saying that Apple will buy Netflix for the same reason they bought Palm. — MacDailyNews, January 31, 2016

What is unique about Netflix? A handful of TV series are not worth $40 billion. Apple is perfectly capable of taking on Netflix without having to buy them, deal with integrating their employees, etc. — MacDailyNews, May 27, 2016

J.P. Morgan: Apple should buy Netflix, but it would likely cost at least $189 billion – February 4, 2019
Citi analysts: 40% chance Apple will acquire Netflix now that President Trump’s corporate tax cut has been passed – January 2, 2018
Citi: Apple 40% likely to acquire Netflix, 5% likely to acquire Tesla – May 5, 2017
Analyst: Apple could double dividend, buy Netflix with repatriated cash under President Trump’s U.S. corporate tax changes – March 17, 2017
No, Apple doesn’t need to buy Netflix – February 22, 2017
Why Apple should buy Netflix or something – February 22, 2017
Apple’s arrogance said to contribute to struggles to make big deals – February 15, 2017
Apple hires Amazon’s Fire TV head to run Apple TV business – February 8, 2017
Why Apple should buy Disney – January 26, 2017
Apple’s new TV app shows just how painfully behind Apple is – December 14, 2016
Apple approached Time Warner about possible merger before AT&T talks – October 21, 2016
Apple’s Eddy Cue: Nope, we don’t want to be Netflix – October 20, 2016
Google signs up CBS for planned web TV service to debut in early 2017; close to deal with 21st Century Fox – October 20, 2016
Bernstein: Apple buying Netflix would be a waste of $50 billion – October 5, 2016
A chance for an Apple buyout offer as Netflix stumbles – July 19, 2016
Here comes á la carte programming – without Apple – July 13, 2016
Should Apple absorb Netflix? – July 11, 2016
Apple to buy Netflix? – May 27, 2016
Should Apple buy Netflix for $53 billion? – May 10, 2016
Apple declines to place bid on NFL Thursday Night Football – March 3, 2016
Why Apple should buy Netflix – January 7, 2016
Apple TV 4 is a beta product and, if you bought one, you’re an unpaid beta tester – November 5, 2015
Apple made ‘audacious bid’ for Top Gear trio of Clarkson, Hammond and May, but lost out to Bezos’ Amazon – September 1, 2015
Why Apple should buy Netflix – April 21, 2015
Why Apple should buy Netflix – March 26, 2014
Jim Cramer: Apple should buy Twitter or Netflix to spur growth – February 7, 2013
The Netflix buyout battle: Apple vs. Time Warner – April 10, 2012


  1. Apple was completely. capable of building a competitive internet search and advertising business. It tried and failed.

    These days Apple cannot even keep its basic computers updated with competitive technology. To say it has the capability to build a service competing with Netflix is the epitome of rose colored glasses.

  2. I’m actually starting to rethink my Netflix service. They have a few good original shows, but their movie selection seems to get worse and worse all while raising their prices yet again. Is it just me or is their a ton of subtitled movies and indian movies that I don’t care to watch. Would be nice if I could filter stuff out to help me find the good stuff.

  3. Producers of media do not like Apple being the only game in town. They fear what happened when Apple ruled music in the early years.
    If Apple would have bought Netflix, the studios would not have been so open to negotiating media deals upon renewal. They would have tried to beat Apple down to just another player, as they tried to create another Hulu or Netflix of whatever name?
    Apple’s investment may have ended up a waste. The studios would be more likely to negotiate with Apple because there was other solid companies to keep Apple from ruling the roost.

  4. I still think it wouldn’t work for Apple.
    Shows like the Punisher wouldn’t be allowed.
    Besides my guy say they are using most of their money on share buybacks to go private one day. IMHO

        1. I’m not sure that’s possible. To make a simple example, imagine a company that has 1000 shares of stock @ $50. That would be a market cap of $50k. Buying back say half would reduce the outstanding shares to 500 shares and at the same time raise the price to $100 maintaining marketcap of $50k. Since marketcap takes into account the liquid as well as non-liquid assets (buildings, patents, etc.) the liquid funds available to repurchase their own stock will always be insufficient. This is why outside money is required to make a company go private.

  5. Netflix’s business relied on support from the industry. No way would they allow an Apple owned company the same latitude.
    Besides Apple buys company that are profitable or adds to their existing technology.

  6. I know that for years I’ve whined about this but here I go again!
    In early 2013 I thought Netflix was a great idea but never bought because I figured if Apple started a similar service (incredibly easy at the time) then Netflix would drop like a rock. Such a service would have sold a zillion Apple TVs. I can’t believe it took them 5 years after me to see the future of video. So I lost out on a 20 bagger because I believed Apple was going to do streaming “any day now”.

  7. Well, this is the management that acquired the Beats at $3B or some such!
    Despite its huge cash pool, we seldom heard about Apple’s investments (maybe Project Titan? Ha!) and acquisition for future growth. So, out of curiosity, a couple of years ago, I briefly investigated what investment Apple has been making for diversification and future growth. As far as I could tell, there has been no bold and important acquisition ever since Tim Cook succeeded Apple. There have been many attempts to buy out firms in the iPhone supply chain, most of which were tiny to small. But most telling was Apple’s attitude to exploit the target acquisition. For example, they tried to acquire a small supplier (in overseas) of a unique component for the 3D imaging (I do not remember the firm), it’s a relatively small amount (some $30M or so). Owner of the business was delighted but Apple apparently made a very hard (cheap and ruthless) negotiation and the owner of the biz was turned off and gradually lost interest. While Apple really wanted it, the owner realized that all Apple wanted to price was his engineering staff. So the owner immediately called off the negotiation. Cook’s investment has been mostly small and heavily oriented toward his iPhone supply chain.
    I firmly believe he has no stomach or bold investments that will contribute to the future growth of Apple, whether they are related to their current line of business or the diversification. He does not seem to know how to effectively take advantage of the huge cash pool Apple is sitting on (for now). He is certainly not a type of person to predict the (near” demise of Adobe Flash way before anyone could even think about it. Anyway…

    1. Have to wonder why.
      No stomach for a big deal?
      Cheapskate offer?
      Petty, but arrogant and greedy negotiation?
      Target did not even entertain such an offer from Apple?
      Or all of above?

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