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TMO Reports - AmTech's Shaw Wu Sees iTunes 4.9 Helping Grow Podcasting
by , 1:00 PM EDT, June 28th, 2005
American Technology Research analyst Shaw Wu on Tuesday released his latest research note, which discusses the impending release of iTunes 4.9 and what its incorporated podcast functionality means for Apple. Now that the software is out and he's had a chance to look at it, Mr. Wu told The Mac Observer that "it's definitely better than the third party stuff. I used iPodder, but this is a lot easier to use."
Mr. Wu believes that the inclusion of podcasting in iTunes 4.9 will help grow the phenomenon. "So many people use iTunes and have an iPod, so because podcasting is available in the music store, it will draw interest, especially with additional marketing from Apple, which we all know is about to come." He also thinks that podcasting gives the company the opportunity to develop another revenue stream, since "they could charge for premium content." Right now, Apple is not charging for access to all the podcasts hosted in iTunes.
The revamped iPod line also drew praise from Mr. Wu, who said that introducing color screens across the board was a "smart move." In addition, he thinks that the price reduction of the 1GB iPod shuffle could improve sales that he said were down. "We found that people were paying US$50 more to get a 4GB iPod mini, so a greater price difference will help sales, although keeping the price of the 512MB shuffle the same could eat into those sales, since you can double the capacity for $30 more.
"I think there are more changes to come," he added. When asked about the upcoming Apple event on July 7, Mr. Wu said that the company told him it wasn't a press event, which led him to believe that there won't be new products announced on that date.
Speculation on the Internet has led in the direction of Apple using the July 7 event to introduce the iTunes-capable cell phone it has been working on with Motorola. Mr. Wu said he's "mixed" on the potential impact of cell phones on the iPod, but he thinks the iTunes phone "provides a hedge against cell phones with music capability. I'm not sure what else Apple gets out of this, though. The financials between Motorola and Apple aren't clear, so I'm not sure how this will impact Apple's results.
"But it remains to be seen if phone companies want people to drain their cell phone batteries listening to music," he continued. "They want them to drain their batteries making calls. Plus, there was all this talk that camera phones would kill the digital camera market, but it's still strong. I'm not a fan of 'jack-of-all-trades' devices."
Mr. Wu continues to keep a "Hold" on Apple's stock, with a $40 price target. ""I think it's fairly valued," he explained. "It's gone up a lot recently, and we require a 20% return to justify a 'Buy' rating, which I don't think is going to happen. I like what Apple is doing, but the transition to Intel processors carries risk, and the company is being heavily targeted in the MP3 player market because it's still the top player. Their growth will also slow, which means comparisons will get very tough in the second half of the year. Apple will still grow, but not as much as before."
Observer Comments
QuoteGuest wrote:
I welcome podcast management in iTunes (free is good!) but I wish it offered one important feature iPodderX offers: automatic podcast conversion to bookmarkable AAC. In fact, I wish podcasters would start offering an optional feed for bookmarkable AAC files rather than MP3.
You can convert the podcasts to AAC in iTunes and get an Applescript that makes them bookmarkable. (That only requires changing the file type.) This is just as fast as iPodderX's method, since it does EXACTLY the same thing--it uses iTunes to make the conversion.
QuoteGuest wrote:
One problem I see is that the perception that podcasts are limited only to iPods and Apple software.
While there isn't any DRM to the podcasts right now, not many players support AAC. Lawyers looking for money are just waiting to file a suit against Apple claiming it to be a monopoly with regard to podcasts.
You don't need an iPod or iTunes to listen to an iPod. But, the truth is a stranger in court nowadays where whomever puts on the better show wins.
The podcasts are in MP3 format, not AAC, so you can listent to them on any MP3 player. The *NAME* may imply that podcasts for the iPod, but they aren't. Maybe you'd like to check your facts, first. Just go to a podcast in iTunes and press command-I to see the file type.
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