In a research note issued Tuesday, analyst Ben Reitzes encouraged his clients to look past the minute details of the initial iPhone and focus on the power that lies in the 'unannounced' multi-touch ecosystem that will eventually find its way into several products across the company's product portfolio.
"We believe this 'Mega-Platform' could help Apple become an 'open-ended' growth story once again with a logical chronology of new products for years to come," the analyst wrote.
Reitzes, who maintains a Buy rating on shares of the Cupertino-based company, said the firm is in a similar position with the multi-touch platform as it was in 2001-2003 when it launched its first iPods with the popular click wheels. "At that time," he explained, "it was perhaps irrelevant to focus on the details around the initial iPods things like capacity and the relatively high $399 price point."
The UBS analyst said he expects the new platform to become prevalent in each of the consumer electronics maker's major hardware products within 3-5 years, possibly sparking touchscreen Macs later this holiday season or sometime in 2008. Among his expectations are touch-screen iMacs, as well as "tablet-like" notebook devices that provide basic computing without the need for a keyboard or stylus if the user desires to keep the device closed.
"We also expect new touchscreen video iPods, more phones and possibly even TVs in the future," he added. "With regard to the iPhone, we expect Apple to have a full line of phones from $150 to $600 available for purchase at multiple retailers in several geographies within three years, just like it did for iPods."
Attempting to quantify the potential effect of the mega-platform, Reitzes estimated the resulting array of multi-touch devices could add about $1.00 -- $0.35 from iPhones, $0.30 from Macs, $0.06 from ultra-portables and $0.33 from iPods -- to Apple's annualized per-share earnings power at some point during fiscal 2009.
"This math does not even include the added benefits of improving retail profitability and catalyzing the services and accessories businesses like the iPod did," he told clients.
While Reitzes did not use Tuesday's research note to alter his Apple model, he noted that his current estimates of $3.20 per-share earnings on sales of $24.6 billion may prove to be conservative.
UBS maintains a $124 price target on shares of the company.