Munster Answers 14 Questions No One Was Asking

Good old Gene Munster. He’s just obsessed with Apple, ain’t he? In a note yesterday to clients, and reported by AppleInsider, Munster answers 14 “questions” about Apple that cover such topics as its iPhones, iPods, Apple TV, Retail Stores, AT&T partnership and more.

In short, it’s nothing we haven’t heard from him before, but just in case you haven’t been keeping up with Piper Jaffray’s Senior Analyst this year, here are the highlights.


Munster predicts AT&T’s exclusive deal with Apple will end next year, allowing the iPhone to be sold by other carriers. He cites the end of Apple’s exclusive deal with French carrier Orange. “For various reasons the company moved from an exclusive relationship with French wireless carrier Orange to a multi-carrier model,” he says. Well, I wouldn’t exactly describe it as “various reasons,” Gene, the reason was made quite clear. The Competition Council in France deemed the five year exclusivity deal unfair and cut it (and all similar future deals between carriers and hardware manufacturers) to a more competition-friendly three months.

But hey, “various reasons” sounds more knowledgeable, I suppose. Don’t forget, he’s a Senior Analyst.

No Cheap iPhone

Munster predicts there won’t be a sub-$99 iPhone 3G offering from Apple any day soon because the company is not interested in competing with the $10 basic cell phones that dominate markets like India. Call me an old cynic, but did we really need an analyst to tell us this? Here, try this: I predict that Apple isn’t interested in offering a sub-$500 MacBook because the market is swamped with $299 offerings from manufacturers of small form-factor PC notebooks. There. That sounded good, can I be an Analyst, please?

Television on iTunes

From AppleInsider’s article:

In his report, Munster also believes that Apple is dissatisfied with the current status of video content offered in iTunes. Specifically, he said the video store is lacking HBO and is often tied to limited movie availability periods.

“We believe Apple is unhappy with the current status of video on the iTunes Store and is working to change it,” Munster said. “These changes, however, will take time, in the form of lengthy negotiations, in order to bring the rights for TV and movies up to speed in a digital world.”

Really, if you look at Apple’s track history with the iTunes store, this is hardly a clever or enlightened insight. Apple has, over the years, struggled to provide a decent selection of TV shows in the iTunes store. It’s a struggle that perfectly mirrors the same difficult journey Apple took getting music from the major record companies into the store in high quality, without the crippling DRM limitations the labels stubbornly clung-to.

In 2008 during his keynote at Apple’s September 9 “Special Event,” Steve Jobs declared that NBC shows were “back in iTunes.” They’d been absent for almost a year, since, the previous December, NBC pulled its content from iTunes over a pricing dispute.

It was obvious there had been a lot of wrangling between Apple and the broadcaster. It’s just as clear today that, as the television industry continues its relentless descent into death, and Apple continues to push for more content to be made available in iTunes, such wrangling will continue. Broadcasters still don’t “get” the Internet. The same way record labels didn’t.

Again, we didn’t need Gene to spell this out. But he did it anyway. He’s generous like that.

Subscription TV Services

I covered this fiction prediction earlier in the month, but it’s fun to see Gene’s still pushing his pet theory about Apple’s planned subscription television model. He believes it will be such a rewarding and complete service, customers will have no need to pay for cable television. It’s natural to ponder how, without a cable account and the broadband services it includes, customers will go about streaming bandwidth-intensive HD television over the Internet. But surely that’s a technical question for engineers, not something a Senior Analyst needs to worry about.

Munster says:

“…we believe Apple has wisely avoided a subscription music model, as music listeners prefer to listen to their own music, and listen to it frequently. Movie watchers, on the other hand, prefer to rent, and typically only want to see a movie once or twice. Likewise, TV viewers are not accustomed to purchasing TV shows on an a-la-carte basis, and a subscription TV service would likely be more appealing.”

I guess this is one of those times when we just have to trust Munster knows what he’s talking about. For the record, I completely disagree with his assertion that customers only want to watch a movie “once or twice.” I treat movies and television shows in exactly the same way I treat the music I own. I buy them so I can enjoy them again and again. But that’s just a matter of opinion, and I have to assume Munster’s claims are backed up with solid market research.

I’m being critical, but it’s fair criticism. Munster (and analysts like him) are paid to make predictions about companies, market trends and the like. But I can’t help feeling these guys are graduates from The School of Stating the Bloody Obvious. We can all do it, and many people do so in their blogs and podcasts without getting paid for the pleasure. They certainly don’t have their ruminations disseminated in the world’s press.

If you read TheAppleBlog regularly you know that, when it comes to a company as secretive as Apple, we often have no choice but to make predictions and deliberate on the probably, possible and preposterous. I just wish Munster’s predictions were not so inclined to swing wildly between utterly banal (‘predicting’ Apple will release ‘something new’ in the next year) and the entirely unlikely (predicting Apple will release an actual television next year that will replace customer’s monthly cable bills).

Why not try your hand at being a Senior Analyst and share your predictions with us in the comments below! Go on, it’s fun!


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