There is much excitement about Apple’s forthcoming streaming service from users. However, analysts are not convinced it will have a big impact on the company’s fortunes (via Bloomberg News). A new note from Goldman Sachs said that the impact on Apple’s bottom line would be “likely small.”
Increasing Stickiness, But Not Bottom Line
In the note, published Monday, analyst Rod Hall said that the impact on the bottom line would be small. That is even in a best-case scenario. He wrote:
While new Video and/or News products might help to increase iPhone stickiness they seem unlikely to make much of an impact on Apple’s bottom line.
Apple Prime
Mr. Hall argued that a Prime-like bundle, encompassing News, Video, Music and iCloud, could make a more significant difference. However, he was not convinced it could have the same impact as Prime did for Amazon.
“The key question for us on this is what the anchor value in such a bundle would be from the point of view of a consumer. In the case of Amazon it is free shipping but in Apple’s case the core driver is less clear to us,” he wrote.
He’s probably right, but everyone’s crystal ball fogs up beyond five years. Who knows where this could go. The iPhone was a nice thing, but not massive for the first few years.