Posts for Ticker ‘iTunes’

What We Expect From Apple Today (AAPL, MSFT, CREAF)

Apple Inc. (NASDAQ:AAPL) is trading up marginally ahead of the technology analyst and press conference in San Francisco, but the stock is currently back within about $4.50 of its all-time highs.  What is being pushed around all over Wall Street and Main Street alike is a new revamped and souped up iPod.

We’ve already gotten the iPhone, we’ve already seen new PC announcements, we’ve already been given the delayed launch date of the Leopard operating system, and we are still viewing the TV initiative as a hobby as Steve Jobs called it himself.  Unless Apple is going to shock the you know what out of everyone with a new unknown and undiscovered product, this iPod revamp makes more than perfect sense.  Consumers want it too.

Back in April, Apple said it had sold its 100-millionth iPod.  This goal is probably to hit 200 million units if it wants to keep driving the stock.  We think this may be more of an iPhone-esque iPod, but without the phone.  So we’d be looking for more touch screen and hopefully some more Wi-Fi features.  We’ll know in a few hours.  Here is what some of our tech friends are saying around the web today:

Business 2.0: wide-screen, touch-sensitive iPod, iPod nano with a larger screen, iPod Shuffle with more memory for the same price….

Engadget: Rick Rubin proclaims "the iPod will be obsolete"
Apple to unleash "The Circle" concept tomorrow?

Newsday.com: What’s coming next from Apple?

CNET: "The iPod is growing up: If Apple really is putting a version of Mac OS X in a new iPod, presumably it has more in mind than showing high-quality reruns of The Hills."

Think Secret: Touch-screen iPod to take center stage

San Francisco Chronicle: What news awaits the Apple faithful?
Speculation centers on redesigned iPods, expanded content offerings on iTunes

After the recent Zune price cuts, you have to wonder if Microsoft (NASDAQ:MSFT) is holding on to this space with looser hands and maybe just as a hobby.  And as far as Creative Tech (NASDAQ:CREAF), everyone now only asks "Who?".

Jon C. Ogg
September 5, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he produces the Special Situation Investing Newsletter and he does not own securities in the companies he covers.

Posted on: September 5, 2007 – 8:49 am in Consumer Electronics, , , , , , , , , ,

Wal-Mart’s DRM-free MP3 Music Not Likely To Hurt Apple or Amazon.com (WMT, AAPL, AMZN, RNWK)

Earlier this morning, Wal-Mart (NYSE:WMT) announced the launch of its own "DRM-free" MP3 music downloads.  Those wanting the service can download from Walmart.com at $0.94/song and $9.22/album.  The new MP3 digital format allows the ability for customers to play music on nearly any device, including iPod®, iPhone® and Zune(TM).

Wal-Mart is one of the first major retailers to offer MP3 digital tracks with music content from major record labels such as Universal and EMI Music, and the launch is aimed to get into the space of Apple (NASDAQ:AAPL) and Amazon.com (NASSDAQ:AMZN).  Wal-Mart’s new MP3 music catalog includes hundreds of thousands of songs and albums, and will be continually expanded with additional mainstream and independent music content. Also, Wal-Mart is currently offering special MP3 album pricing on hundreds of album classics.

It used to be that once Wal-Mart went after your space that things became instantly worse for you and your other competitors.  But after the Wal-Mart woes of late, they just don’t seem able to wrangle away customers at the same rate.  In fact, many may now chuckle at new initiatives because its online presence is still too small to be a major factor.

Steve Jobs and Jeff Bezos probably didn’t call each other up in a panic this morning, and probably won’t be tomorrow either.  These stocks are even higher on the heels of RealNetworks (NASDAQ:RNWK) launch of a new digital music company with MTV.  We addressed this earlier today.  If these were as threatening as they sound then Amazon.com (AMZN) shares might not be up 3.8% and Apple (AAPL) shares might not be up 4% today.  Getting the huge established tech predators unseated from a dinner table at their favorite restaurants usually takes more than getting a two-top table in the corner.

Jon C. Ogg
August 21, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 21, 2007 – 2:31 pm in Consumer Electronics, Entertainment, Internet, , , , , , , , , ,

Can Napster Become Profitable? (NAPS)

Napster Inc. (NASDAQ:NAPS) is set to report earnings after the close, and First Call pegs estimates for another loss at -$0.15 EPS and just under $32.5 million in revenues.  If the company offers guidance it is expected to post -$0.15 and $33.3 million revenues next quarter.

Now what is interesting here is that Napster has been deemed not quite on life support or in limbo, but the financial situation is a peculiar one.  The company is expected to post wide losses for fiscal March-2008 and for fiscal March-2009.  The revenues for each year respectively are $140.6 million and $165 million.

As of last quarter the company has $66.4 million in cash and equivalents.  The good news is that its entire liabilities were only $37 million but the company has been bleeding out over $7 million  (last quarter) and over $9 million in each of the two prior quarters.  Its total cash flow from operations was over $3 million last quarter. 

Here is the good news, at the current rate the company can sustain itself for several years without hitting the cash trough.  The bad news is that if it loses any key relationships then it has some serious decisions to make.  There has not been a peep from the 2006 hopes of any merger, and the company has not really been able to capitalize on being potentially the top iTunes competitor out there. 

With the contract agreements already in place there has to be some value to the online music database, but the question is more "what is that price?" than a current answer has shown.  The company has a $128 million market cap, and with shares at $2.76 it is closer to the bottom of its $2.55 to $4.92 trading range over the last 52-weeks.

Jon C. Ogg
August 1, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: August 1, 2007 – 12:37 pm in Earnings, Internet, Media, , ,

Apple’s (AAPL) iTunes: Custer’s Last Stand

The record industry is being destroyed by a combination of cheap digital downloads and falling CD sales. Apple’s (AAPL) iTune operation is now the third largest seller of music in the US behind big box retailers Wal-Mart (WMT) and Best Buy (BBY).

The ripping of CDs pulls untold millions of dollars from potential legitimate sales. And, shareholders in music publishers are paying for it. Warner Music Group’s (WMG) stock is down 50% in the last year.

So, it should not be terribly surprising that the publishers want more money, a bigger cut, from what is likely to be their largest sales outlet within the next year, iTunes. Apple is likely to object to the idea, but the music guys are running out of options. Animals can be dangerous when cornered.

According to The New York Times, Universal Music, a unit of Vivendi, the largest music publisher in the world, had decided not to renew its deal with iTunes for another year. Instead, it will offer music to Apple as long as it likes the terms. By going that route, Universal could put individual titles at will.

Universal’s music accounts for one out of every three albums sold in the US, according to Nielsen. Universal could hurt iTunes, But, perhaps iTunes could hurt Universal more by refusing to carry its titles at all. That would probably lead to protracted anti-trust litigation, the kind that has haunted Microsoft (MSFT) for years.

But, in the short term the question will be whether other large publisher like Warner would join a revolt and whether the artists represented by the large music companies will have a problem with having their music pulled from the iTunes platform.

Artists may be finding another way to market their music, and that could work against Apple. Music company EMI and tech firm Snocap have set up a system so that artists can sell their records in an MP3 format, which would work on a number of devices including the iPod. The techology would allow them to sell their songs directly from their own websites or from social network sites.

Up to now, Apple has been able to hold the music companies in line. That may be ending.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com

Posted on: July 2, 2007 – 4:49 am in Uncategorized, , , , , ,