Apple's Front-Runner Challenge
Apple (AAPL) has raced to the front of the digital music market with its iPod line. But some are wondering how long it can stay in the pole position.
"We're still at the very early stages of this transition" to digital music delivery, said Mike McGuire, who covers the online music market as a research director at GartnerG2. "The game ain't over by a long shot."
How the competition ultimately turns out should have big implications for Apple's stock over the long term. Its shares tripled last year as booming iPod sales -- now more than one-third of the company's revenue -- revved up the company's earnings -- and its potential prospects. The
Should anything slow the iPod's momentum, Apple's stock -- which has been a momentum trader's dream -- could also begin to drag.Apple's iPods held 82% of the market for hard drive-based digital music players last year, said Shyam Nagrani, an analyst at industry research firm iSupply. But the company likely will see its share slip in coming years, he said. "There's no company in this world that can maintain 80% market share forever," Nagrani said. Indeed, the iPod already faces serious challengers and the competition is likely to heat up in the near future. Last week, for instance, Dell rolled out a line of new music players that cost significantly less than similarly equipped iPods. Dell's announcement came one day after Apple
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV