Posts Tagged ‘iPod’

Will Apple Offer a Subscription Music Service (and Steve Jobs Eat Crow)?

March 23, 2008

How much will the recession hurt tech? Will subscription music ever take off? Do Facebook’s privacy controls solve the problem of too much info on the Web? Plus, March Madness picks in this week’s Digital Dish from BusinessWeek reporters Spencer Ante, Heather Green, Arik Hessehdahl and Catherine Holahan.

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Apple: To Buy Or Not To Buy, That is the Question

January 23, 2008

For the last few years, Apple has been one of the hottest companies–and stocks–on the planet. But this week, the Apple aura took a huge blow when the company reported softer-than-expected iPod sales and provided earnings guidance below analysts’ expectations. Today, the stock plummeted 11% to $139.

What should investors do now? My gut feeling told me to avoid Apple like a New York City train during cold season. But I’m starting to feel more bullish about Apple after doing some homework. My colleague Peter Burrows provides a pretty convincing case that “there are signs that Apple can not only weather an economic contraction but emerge stronger than ever” thanks to growing strength in its PC business of all things–which produces triple the profit of an iPod.

Mark Kandel from Goldman Sachs actually raised his earnings forecast for Apple (only 3 cents) as a result of “strong Mac growth, increasing iPhone revenue, better gross margin, and a richer mix of iPods.” Toni Sacconaghi from Sanford Bernstein maintained his estimates but wrote that “trading prices (i.e. below $140 share) provide an attractive entry point.” Still, he is cautious, arguing that iPhone expectations “may still be too aggressive”; he also thinks the recession could crimp consumer demand–even for Apple products.

What are you doing?

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Did Steve Jobs Miss the Bullseye at Macworld?

January 19, 2008

BusinessWeek technology reporters Heather Green, Arik Hesseldahl, Catherine Holahan and Spencer Ante discuss Macworld, whether the tech sector is headed for a downturn, and the billion-dollar-plus buys of MySQL and BEA in this week’s broadcast of the Digital Dish.

My colleague Arik is bullish on the future prospects of Apple’s new online movie rental service. But I am less optimistic. Apple TV will get better and do better but it’s not a groundbreaking product like iTunes/iPod or the iPhone. Jobs can’t ride into the local square and save the day because there are already a few sheriffs in town. Netflix is the dominant player in online movie rentals and they are offering a download service for FREE with 6,000 movies and TV shows right now. Interestingly, the top five most-watched shows are all TV programs, according to the list on the NetFlix Web site on January 19: Heroes, The Office and 30 Rock.

As for Macworld, the maestro Jobs turned in a middling performance. He was due for one, no doubt. That’s the nature of creativity. Every film Martin Scorses makes can’t be a masterpiece like Raging Bull or Taxi Driver. Every once in a while you’re going to have a Casino or a Bringing Out the Dead. Macworld 2008 was the Casino of Steve Jobs career.