Could An iOS Exclusive iRadio Win The Summer Smartphone War For Apple?
by Nicholas Ward
Last Friday I ran across a market current quoting a source from The Verge proclaiming that an Apple (AAPL) iRadio was imminent (scheduled for a summer 2013 launch). I found this interesting; this was a direction that I did not expect Apple to go to. The company's stock is still down, trading 5.65% off its 52 week low. Apple needs a catalyst to give life back to its stock. The initial negative news surrounding Samsung's Galaxy S4 gave Apple shares a spark; but, during the latter half of last week the stock fell 6%. I recently expressed my opinion that a new piece of hardware would be key to the stock's redemption. I like the idea of any new product for Apple, especially since lately it seems as if no news is bad news for this company's stock price. However, I can't help but wonder if moving into the low margin space of internet radio will truly benefit Apple in the long term. Apple thrives off of its high margins and even if the company is able make unprecedented agreements with record companies in regards to low royalties paid, its iRadio can only achieve so much success with the vast majority of revenues coming from advertisement dollars. But then, on Tuesday I stumbled upon another market current citing a Wall Street Journal report that the new iPhone 5s would be available this summer as well. The more and more I thought about it, the more and more this sequence of events made sense; especially when I consider previous iRadio rumors concerning its possible iOS exclusivity. While iRadio serves as a stand alone division, this service, if done well and accepted by consumers as a must have app, might be the added weight that would tip the summer smartphone battle into Apple's favor. To see just how productive this new product could be for Apple I looked into Pandora (P), who is the dominant player in the industry right now. read more »
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