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BusinessWeek: Apple should consider iPod IPO







BusinessWeek: Apple should consider iPod
IPO

BusinessWeek: Apple should consider iPod
IPO
05/05/2004 08:20 AM

BusinessWeek's Alex Salkever says that Apple would profit nicely from spinning out its digital music business (iPod and iTunes) before the market gets commoditized...




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BusinessWeek: Apple should consider iPod IPO

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My 30 gig iPod is full to the rim, and since I have been collecting an average of 300 megs of legal non copyright infringing unknown artist music a week, I need some more room. My wife wants the 30 I have now, so I am hoping that Engadget is correct and think Apple is bluffing. I can hold her off a couple of months but I am hoping that they do have a 60 gig model in works as I will be buying one if they do. The wife says she doesn't want a mini she wants the real deal. You fellows out their understand what the means. [Engadget]

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Business Week is suggesting that, for all the congratulatory backslapping the folks around Apple have been doing around the iPod and iTunes, they'd be smart to spin off their music business now. The reasoning is that the music side of Apple probably has a much higher perceived value than real value right now. While Apple has been able to command considerable marketshare in both the downloadable music market (even though they don't make any money there) and the handheld music player market, the writer doesn't believe they can hold either position. They've been able to get away with being the high-priced provider so far, but competitors are nipping at their heals. Both the hardware and the downloadable music services risk becoming commodity products, and spinning out a portion of the business and taking the cash would let Apple move on to the next big thing. Of course, the main problem with this idea is that it doesn't appear that Steve Jobs believes the market is going to become commoditized (though, the article suggests, recent insider selling at Apple means other executives aren't so sure).

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BusinessWeek: Apple should consider iPod IPO

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