AppleInsider Staff
Analyst Scott Sutherland issued a 35-page report Wednesday, in which he said he believes the investment opportunity for connected devices is larger than most people expect. With a strong early presence in the growing smartphone and tablet markets, Apple has an advantage in the mobile market that the company could use to drive adoption of other products, like Macs, the Apple TV and new cloud-based services.
"Apple's rapid emergence and dominance in mobile has turned the industry upside down," Sutherland wrote. "The control once enjoyed by mobile operators and device manufacturers is being absorbed by Apple."
Sutherland sees Apple continuing to grow the iPhone platform with the addition of a CDMA handset, allowing the company to address a potential market of 550 million CDMA subscribers. He noted that Apple's record 14.1 million phones sold last quarter represented 18 percent of all smartphone sales, but just 4 percent of all mobile phone shipments.
With the iPhone expected to arrive on the Verizon network in the U.S. in the near future, Sutherland sees the carrier selling more than 10 million of Apple's handset in 2011.
The analyst said he also believes the iPad will become a significant incremental revenue stream for Apple. He has projected sales of 14.3 million iPads in 2010 will give Apple 96 percent of the tablet market. If tablet shipments hit 45 million in 2011, he sees Apple selling 24.2 million of them, taking a 54 percent share.
"Tablet computers are coming so fast, industry estimates do not even seem to be able to keep up while Apple analysts have been trying to leapfrog one another with the most aggressive iPad estimates," he said.
Sutherland also highlighted the Apple TV as a "hobby that builds the ecosystem," calling it a business that could grow significantly in the coming years. He noted that while Apple has been successful with most media types, video has been a "weakness" for the company's iTunes service.
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Christine McKee
William Gallagher
Amber Neely
Malcolm Owen
Andrew Orr
33 Comments
JUST initiating coverage?
Where were they the last 4 years?
An interesting notion - the "hobby that builds the ecosystem".
I bought an ATV2, largely because it was cheap. My son took decided he wanted to get one also, but was thinking in terms of having a machine to act as a media server, and doesn't want to keep his MBP on all day for that. When he mentioned it to me, I thought - great idea. Now we both went out and bought Mac Minis to serve the ATV2. Now I have removed all the media from various Macs around the house, put them all on the Mini, and it is backed up by time capsule without redundantly having the same files on various machines.
Now, granted, we were already an all Mac household. Still, 2 $99 purchases ended up with buying 2 $699 computers to go with them.
Thank goodness this is a poor economy and we have been frugal. Otherwise Lord knows what we would have ended up getting.
As an aside, this morning I just bought Rogue Amoeba's Airlink which lets you stream any audio (not just iTunes) eg. Pandora to the ATV2 or for that matter to the iPhone/iPad. Rogue Amoeba has a bunch of very nice low priced utilities such as this one.
JUST initiating coverage?
Where were they the last 4 years?
Not covering AAPL. No investment firm can cover all stocks, even the large company stocks. I've never even heard of Wedbush before. Seems to be a smaller firm.
Pretty pedestrian observations... even by "professional analyst" (oh, an oxymoron) standards.
I'm not an expert here, but shouldn't it be time for a stock split?