Apple's iCloud seen leading to gadgets 'we haven't thought of yet'

After meeting with members of Apple's leadership, investment bank Barclays said this week it believes the company's iCloud is the most significant service introduction since iTunes, paving the way for the company to introduce products that don't yet exist.

"Long term, we believe that iCloud could be Apple’s most important new service since the launch of iTunes in 2003," analyst Ben Reitzes said following a face-to-face meeting last week with Apple chief executive Tim Cook and chief financial officer Oppenheimer. "We believe Tim Cook clearly understands how important iCloud is to Apple’s future."

In particular, Reitzes noted that iCloud stands to foster additional customer loyalty towards Apple, as it monetizes users' investments into their iTunes purchases over the years while also adding the benefit of freeing those same customers from wires.

"Only Apple can currently deliver this type of convenience and integration," he said. "We agree with Tim Cook – iCloud is profound. It basically makes the cloud the digital hub - not the Mac or PC."

As such, the analyst has dubbed iCloud the "sneaky" product launch of 2011, vouching his belief that the service may drive some of the company's most long-term value by laying the foundation for an earnest assault on the TV market in addition to "devices we haven't thought of yet."

Reitzes sees iCloud as the "new hub" for users' media, allowing for wireless distribution to a variety of devices by offloading data storage to the cloud. He notes that global PC sales estimates were cut for 2012 due in part to services like iCloud that "literally help 'demote' the PC from a critical hub to just another device competing for your dollars.

It is unclear what new devices, if any, Apple is working on that leverage iCloud, but it seems to analysts that the service will play a part in shaping the future of the company and its products.

As more product makers move to the cloud, local storage such as flash memory and hard drives is slowly becoming irrelevant as users are able to stream or download content from services like iCloud. iTunes users will be able to take advantage of the move when iTunes Match is released, allowing them to re-download any song in their music library regardless of where it was purchased.

Considering the importance of iCloud and the possibilities surrounding the service, Reitzes gives AAPL an overweight stock rating with a target price of $555, and believes that the company's market cap can see further gains based on Mac and iPhone sales.

Recently the firm's Global Wireless Equipment team raised its 2011-2014 smartphone forecast to 65% year over year growth in 2011 to 467 million units, up from 49% or 420 million. For 2012, analysts see a 43% growth to 668 million smartphones, up from the previous forecast of 35% representing 567 million units. The new forecasts are based on Apple's strong iPhone 4S launch and prospective sales numbers as well as an eventual iPhone 5 release.