Mystery Apple iTunes Announcement Won't Be Music to Investors' Ears

Apple has scheduled an iTunes announcement Tuesday. As Apple (AAPL) gears up to make an iTunes announcement, the front of its Web site bragged that it would be a day that "you'll never forget." But at least one analyst predicts that the news won't be so memorable for investors.

"It'll be a big yawn for investors. They're trained to expect big things from Apple like an iPad, or an iPhone or some kind of gadget," says Trip Chowdhry, an analyst with Global Equities Research. "It'll likely be an iTunes enhancement and that's a nonevent for investors."

He expects enhancements such as an iTunes video service or usability improvements. "I don't think investors will be excited by usability and service enhancements, but customers should be," Chowdhry says.

More Speculation

Other analysts are predicting more radical changes. Some say they wouldn't be surprised to see Apple's iTunes service move up into the cloud, meaning it would be an Internet application instead of an offering that gets downloaded to a device or computer. Others speculate that iTunes could become a subscription service.

Meanwhile, Billboard.biz is predicting Apple will announce it's offering the Beatles catalog at its music store. The collection has eluded the company for years, and rumors abound that Apple may finally be about to unveil a licensing agreement for Beatles songs. But even a Beatles deal would be unlikely to boost iTunes enough to trump Apple's iPhone sales or make a significant impact on the company's overall revenue.

Chowdhry notes that Apple's software sales, which includes iTunes and transactions from its App Store, usually generate a mere $400 million to $500 million out of its billions of dollars of quarterly revenue. In the third quarter, for example, Apple posted a whopping $20.3 billion in sales.


Increase your money and finance knowledge from home

Investment Strategies

What's your investing game plan?

View Course »

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

Add a Comment

*0 / 3000 Character Maximum

2 Comments

Filter by:
Theresa Milhimes

I am a foster for Cat Tails Inc. and non profit 501c3 cat rescue and we are in need of donations. We have saved thousands of cats from death row shelters and owner give up and stray cats. We have everyone completely vetted spay/neutered and all shots and testing then we try to find them new loving homes. With the economy bad right now our funding is not good at all and owe more the 50,000.00 out in bills not to include food and other essentials for the care of cats and kittens. Please contact out director Joy Purnell at Aptbrokers@aol.com to donate or ask any other questions. If you can donate tax deductible donation we would be ever so grateful any donation is a blessing Thank you Theresa Foster for cat tails

November 17 2010 at 12:37 AM Report abuse rate up rate down Reply