HAB

Cowen Advises: Place Your Mobile Internet Bets On Google, Not Apple

I can't believe what "analysts" are getting paid to churn out. It would seem only Munster and Wu "get" where AAPL is headed - surely Cowen & Co. doesn't. Based on the prior conference call, it's painfully obvious that AAPL will be sharing in the revenue of the iPhones from AT&T. Some have estimated as little as $5, but more realistic numbers are within the $8 - $12 per month range. At just $5, and using the conservative 10m units in one year, that will generate an additional $600M per year in cash and profits - $1.2B at $10 per month. Since AAPL is reinventing how activation and other things, it's safe to say they will get a tad more than RIMM's $5/mo - I use $8 for my estimations. At that number it's $960M per year.

Those numbers are cumulative - just imagine what happens as they sell anything close to 45M in 2009 as Munster would suggest - I for one don't think they'll get the same revenue share outside the U.S., but they will get something.

AAPL = brand loyalty, something the carriers are drooling for... and AT&T now has.

If that's not enough, look at what the Apple TV unit will do after online movie rentals go live (anywhere from calendar Q3 (rumor) to early 2008 (analysts estimate). That alone is a multi-billion dollar industry and it will only grow as bandwidth speeds to the home increase.

Finally, look at Mac sales - they're absolutely on fire and getting BETTER. This quarter alone could see 50% growth YoY instead of 30% as new MacBooks have been flying off shelves. Leopard will be a catalyst for additional sales in Fiscal Q4 as well. Leopard alone will bring in over $300M in Q4 alone - not bad for ONE quarter.

Oh, and one more thing , SJ hinted at a totally new product coming later this year - no telling what it is, but you know it's going to make a splash.

The bottom line is that AAPL is BASF of the electronics industry - they don't make the products (first), they make them better.