Banc of America Sees 'Modest Near-Term Impact' on Apple by Yahoo! Music

Forbes magazineis Web site features a brief news piece about Banc of America Securitiesi reaction to Yahoo!is entrance into the online music business with a subscription-based service. The financial services firm sees "very modest near-term impact" on Apple and slightly lowered the computer makeris stock target price from US$47.50 to $44 "to acknowledge the risk of increased competition in the MP3 market, with a focus on 2006."

The company also noted that "the stickiness associated with iTunes and Appleis hardware has had a protective effect, and Apple has held a share in music downloads and gained share in MP3 in the last few quarters. If the subscription model does prove to be popular, we would expect Apple to counter and match with a subscription model of its own, which would increase margins."