Is Universal Music good for Apple??

Posted:
in General Discussion edited January 2014
I think this could be a coup for Apple. Just imagine - you've got the software (iTunes), you got the music (Universal) and you got the hardware (iPod) !



Methinks if apple go for this, they could be the one/first Music Industry Giant that finally makes money from selling music down that fat pipe to your home! and onto your "digital lifestyle" devices like iPod... that's if people want to pay of course... hmmmm... these could be interesting times.. Of course Apple needs to justify $6Bn for this punt on the future...





http://www.silicon.com/news/500008-5...l?nl=d20030415



http://www.silicon.com/analysis/5000...l?nl=e20030416
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Comments

  • Reply 1 of 26
    hmurchisonhmurchison Posts: 12,268member
    It's only a Coup if Apple has been able to brigde the Divide that exists between Consumers and the Entertainment Conglomerates.



    Consumers simply want to be able to download their Music and utilize that music on their audio playback devices without jumping through hoops. If Apple can keep this capability without opening themselves to rampant piracy then purchasing UMG would be huge.
  • Reply 2 of 26
    bungebunge Posts: 7,329member
    I think this could be a win-win situation if the two companies could cross market accurately. There are a lot of musicians that use Apple products already, and Apple already likes to support artists. There's a certain synergy that I find very appealing.
  • Reply 3 of 26
    marcusmarcus Posts: 227member
    Hmmm, Apple registered Appleuniversal.com on the 4th April...looks like it could be a runner.



    Domain Name: APPLEUNIVERSAL.COM

    Registrar: BULKREGISTER.COM, INC.

    Whois Server: whois.bulkregister.com

    Referral URL: http://www.bulkregister.com

    Name Server: NSERVER2.APPLE.COM

    Name Server: NSERVER.APPLE.COM

    Status: ACTIVE

    Updated Date: 11-apr-2003

    Creation Date: 11-apr-2003

    Expiration Date: 11-apr-2004



    Peace,



    Marc
  • Reply 4 of 26
    snoopysnoopy Posts: 1,901member
    If Apple does buy UMG, it may cost more than the 6 billion dollar figure being talked about. Here is something in The Register.



    http://www.theregister.co.uk/content/39/30289.html
  • Reply 5 of 26
    buonrottobuonrotto Posts: 6,368member
    Apple would have to diassociate the distribution and production aspect from the recruiting aspect to some degree. As the second analysis link mentions, the ways of finding new talent is changing, and I don't think Apple is too interested in getting into that dogfight.



    The obvious point of all this is of course to cross germinate their software and in this case I think we could call it middleware into an entity that it less duplicitous than Sony but with that kind of scope in mind. Apple has to have a real master plan, and this rumor makes me think they just might have a big picture in mind, bigger than what we thought was media creation tools after FCP came out. We're talking professional and consumer service and solutions from top to bottom, even eliminating the middleman in this case.
  • Reply 6 of 26
    macsrgood4umacsrgood4u Posts: 3,007member
    With Apple share tumbling below $13.00 the company has issued the following:



    Press Statement from Apple









    CUPERTINO, Calif., Apr 16, 2003 /PRNewswire-FirstCall via COMTEX/ -- "Apple (AAPL) has never made any offer to invest in or acquire a major music company. The press statements this morning attributed to Vivendi board member Claude Bebear are untrue, as Mr. Bebear has confirmed in a later report," said Steve Jobs, Apple's CEO. "Beyond these comments, we will abide by Apple's policy of not commenting on rumors."
  • Reply 7 of 26
    marcusmarcus Posts: 227member
    Quote:

    Originally posted by MacsRGood4U

    With Apple share tumbling below $13.00 the company has issued the following:



    Press Statement from Apple









    CUPERTINO, Calif., Apr 16, 2003 /PRNewswire-FirstCall via COMTEX/ -- "Apple (AAPL) has never made any offer to invest in or acquire a major music company. The press statements this morning attributed to Vivendi board member Claude Bebear are untrue, as Mr. Bebear has confirmed in a later report," said Steve Jobs, Apple's CEO. "Beyond these comments, we will abide by Apple's policy of not commenting on rumors."




    It sounds almost like something being written by Baghdad Bob... Perhaps the Military should start their search for the Guy nearer to Cupertino?
  • Reply 8 of 26
    macsrgood4umacsrgood4u Posts: 3,007member
    I think there really is something to this. If the companies are in negotiation then an offer wouldn't be made until the end I think. Plausible deniability. The fact that the Vivendi exec. retracted a statement really is interesting. He obviously made it and then got the rath of SJ and had to withdraw it. In any event, Universal is in the midst of a lawsuit with Barry Diller who is saying no deals with anybody can be made until he's paid monies he claims are owed to him. Sorry don't have that link but it's out there. It's also a way to stop the stock from bleeding to death at the moment as Wall Street is negative on the prospects (that alone should make it a good idea!).
  • Reply 9 of 26
    baumanbauman Posts: 1,248member
    MacCentral has a story out about this now:

    http://maccentral.macworld.com/news/.../16/universal/



    Jobs says Apple has not made an offer.



    Quote:

    Today more fuel was added to the fire when financial news service Bloomberg posted comments attributed to Vivendi director Claude Bebear, who reportedly said that Apple "will probably make an offer" for Universal Music Group. Bebear later denied making such a comment when asked by the Reuters news service.



    "Apple has never made any offer to invest in or acquire a major music company," said Jobs in a short statement. "The press statements this morning attributed to Vivendi board member Claude Bebear are untrue, as Mr. Bebear has confirmed in a later report. Beyond these comments, we will abide by Apple's policy of not commenting on rumors."



  • Reply 10 of 26
    jaredjared Posts: 639member
    The most interesting aspect to this is the:



    Quote:

    "Beyond these comments, we will abide by Apple's policy of not commenting on rumors."



  • Reply 11 of 26
    macsrgood4umacsrgood4u Posts: 3,007member
    bauman.... already mentioned a few posts above! Here's a story on Barry Diller and how he could stop any deals that Vivendi might make (from Show Biz Data):



    Barry Diller has joined the long line of litigants suing Vivendi Universal, charging that the Paris-based conglomerate had reneged on its agreement to reimburse its USA Interactive company for taxes on its preferred shares in Vivendi Universal Entertainment. The wording of the lawsuit appeared to indicate that Diller has had a complete falling-out with the current Vivendi regime. It said in part, "Vivendi's refusal to honor the clear commitment it made under [former Chairman Jean-Marie Messier] is a classic case of buyer's remorse -- an unjustified refusal to live up to obligations clearly and knowingly made." Today's (Wednesday) Los Angeles Times quoted Sanford C. Bernstein & Co. analyst Michael Nathanson as saying that Diller's suit raises a new obstacle in Vivendi's effort to sell the entertainment units "because you want clarity if you're the buyer."
  • Reply 12 of 26
    Quote:

    Originally posted by MacsRGood4U

    With Apple share tumbling below $13.00 the company has issued the following:



    Press Statement from Apple









    CUPERTINO, Calif., Apr 16, 2003 /PRNewswire-FirstCall via COMTEX/ -- "Apple (AAPL) has never made any offer to invest in or acquire a major music company. The press statements this morning attributed to Vivendi board member Claude Bebear are untrue, as Mr. Bebear has confirmed in a later report," said Steve Jobs, Apple's CEO. "Beyond these comments, we will abide by Apple's policy of not commenting on rumors."




    Looks like it worked



  • Reply 13 of 26
    argonautargonaut Posts: 124member
    Damn! Didn't buy my AAPL shares quick enough....



    Some great comments in this thread..



    Interesting times.... first they buy the tools to make music - eMagic - and now they are looking at also buying into the distribution of the music made with these tools..



    Go Stevie Go!
  • Reply 14 of 26
    I am honestly afraid that Apple might "spread itself too thin" and make investments it can't handle. That's why Commodore went out of business, you know. I don't want the same thing to happen to Apple.



    If Apple could find a way to buy Universal Music without loosing its cash, it would probably be very good for Apple, consumers, and the music industry.
  • Reply 15 of 26
    macsrgood4umacsrgood4u Posts: 3,007member
    Apple wouldn't have to put up all the cash if they desired. Stock and money from another source would suffice.
  • Reply 16 of 26
    thuh freakthuh freak Posts: 2,664member
    i dont think its a good idea in any sense for apple to enter the music world like that. Apple is a computer company. buying a record label would be moving sideways and it doesn't seem to help in any significant way with their hdwr or sfwr business. i dont want apple to become some huge conglomerate.
  • Reply 17 of 26
    snoopysnoopy Posts: 1,901member
    I believe this sideways move is why the stock dropped. Apple needs to be focused, and not a "jack of all trades." The stockholder's meeting next week should be interesting.
  • Reply 18 of 26
    macsrgood4umacsrgood4u Posts: 3,007member
    This just in. CNBC's David Faber reported this afternoon at 3:30 PM EST that SJ/Apple has offered to invest 1.5 billion in Universal. They also said the Apple music service would be announced "later this month".
  • Reply 19 of 26
    hmurchisonhmurchison Posts: 12,268member
    Quote:

    Originally posted by snoopy

    I believe this sideways move is why the stock dropped. Apple needs to be focused, and not a "jack of all trades." The stockholder's meeting next week should be interesting.





    No the Stock dropped because it's a large expenditure. Any company in Apples position would have yielded the same effect. People are reading too much into this from Wallstreet.



    Sideways. I don't think that applies here as well. iPods are not computers but they have had phenomenal success. Any proposition that offers the potential of huge profits will come with it's associated risks.



    I find this much less dangerous for Apple that the "Headless Mac" with expandability and low cost. Remember Apple had roughly 63 Million in profits 2002...Universal Music Group had 500Million. Do the math.
  • Reply 20 of 26
    thuh freakthuh freak Posts: 2,664member
    Quote:

    Originally posted by hmurchison

    Sideways. I don't think that applies here as well. iPods are not computers but they have had phenomenal success. Any proposition that offers the potential of huge profits will come with it's associated risks.



    mp3 players have always been made by computer or tech companies. the connection from ipod to computer is a lot easier for me to understand than: computer to annoying cd "clubs". i'm not saying that apple won't take advantage of the opportunity (if they buy) and work on some music services and all, but at the same time they would (partially?) own a music label and that part doesn't seem to fit with the company.
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